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Tuesday, September 16, 2014

Schenectady Casino Bidder Invests in Slots Games For Kiddies

I mentioned the group opposing a casino in Schenectady the other day; haven't really discussed them here before. Their website, Stop the Schenectady Casino, can be found here.

On their homepage now, there's a link to this report about a multi-million dollar investment by Rush Street Gaming, the company that is hoping to build the Rivers Casino and Resort at Mohawk Harbor in the city, in Ruby Seven, a company that is marketing "social gaming"- or casino simulation games - to kids as young as 13 years old.

Ruby Seven games currently being distributed include “Cats Vs. Dogs Slots” featuring big-eyed cartoon cats and dogs in “a FREE to PLAY slots game with the cutest puppies and kittens, hourly bonus coins, and realistic slot machines [capitalization in original],”and a poker game promising to be “simple to learn.”
The game is accessible via Facebook, where it says that the game "is intended for use by those 21 or older for amusement purposes only." However, if you click on the Terms of Service, it reads:
The Service is intended for use by those 21 or older for entertainment purposes only. By using this Service, you declare that you are 13 years old or older. If you are between the ages of 13 and 18, you declare that your legal guardian has reviewed and agrees to these Terms.
Which I'm sure really happens.  (Apple iTunes has changed the rating to 17+.)  Although the games are said to be "free," in fact, as the report explains, this was actually an $8 billion market in 2012. The games come with free chips (or equivalent), but players have to pay up to replenish when they run out, and they can purchase bonuses and upgrades.

The report notes that Ruby Seven seeks to "bridge the space between land-based casinos, onlinegaming and social casinos." And it suggests the obvious; that Rush Street and its partner are attempting to sow the seeds of casino gambling in kids so that they can convert them to paying customers at their casinos, either online or brick-and-mortar, and possibly acquire behavioral information for marketing purposes, for when they reach legal gambling age.  The meticulously-footnoted report cites a study that concludes: "Studies of adult problem gamblers have reported that earlier onset of gambling is a risk factor for problem gambling."  And that's interesting now that I think about it just based on my personal experience.  All of the people I grew up with who later had an issue with gambling were amongst those with whom I went to Roosevelt Raceway back in high school.  (The tracks surely did their part.  In those days, the gambling age here was 21; I would go when I was 16, I looked and sounded more like I was 14, and only once do I ever recall being turned away at the betting windows.)

This report also notes that these game developers can make it easier to win than it is in actual gaming, thereby creating false impressions as to the odds involved; and that the "social network" aspect of the games and the virtual prizes involved can be as equally alluring as the promise of winning money.  It's an interesting read; and again, the link is here.

The report is dated September 9, the day after Rush Street presented for the Schenectady project, and the same day that they presented for the Newburgh casino that they hope to build in partnership with Saratoga harness (as well as for the Greenetrack proposal near Stewart Airport).  During those presentations, Rush Street emphasized the Best Places to Work awards that they earned at their Pennsylvania facilities.  But the very next day, Jim Odato reported in the Times Union that a casino workers union wrote to the Gaming Commission to complain of "illegal harassment by casino managers including threats, surveillance and other intimidation." 
Asked about the union's complaints, Rush Street Chairman Neil Bluhm and CEO Greg Carlin said the company's record speaks for itself. During two days of presentations to the siting board earlier this week, the company emphasized it has won repeated best-employer awards at its three casinos for years.

"We certainly have disputes with companies all the time, but there is nothing like this anywhere else," said Martin Leary, gaming research director for Unite HERE. The union has 275,000 members in hospitality and food service jobs, including about 100,000 casino workers. [Times Union]
The Schenectady group has also posted articles about the proposed casino's proximity to Union College, and the potential danger presented to students who may be lured there.  I actually went to Union, graduating in 19--......well, a long, long time ago.  Not sure what the student body is into there these days; but I don't recall much in the way of on-campus gambling in the form of poker games, etc.,  Back then, in 19--....well, back then, for horseplayers like myself, the Schenectady OTB office was just a short distance away; and around the block from there was Baum's Newsroom, where one could pick up the NY Post (to keep abreast of the PC's then, not to mention the internets) and the Daily Racing Form, probably for a couple of bucks.  And the Saratoga harness track was about a half hour away; we took many a trip there via Route 146 through Clifton Park, probably a couple of times a week when it was open.  The vast majority of students however made the trip to Saratoga to hook up with Skidmore girls (Union had just recently gone co-ed and the male-female ratio was untenable for guys), and I'd guess that the hormonal instinct is still more powerful than the lure of gambling for most students.  However, I don't want to downplay the concerns; I'd imagine that many of the students whose families can afford to send them there probably have a little disposable income available to piss away, and would therefore be likely targets for a casino operator.

 - City & State reports on the financial woes of Caesars, bidding for an Orange County casino in Woodbury, citing "a streak of quarterly losses and a mountain of debt that is projected to lead the company into a major debt restructuring, if not an outright bankruptcy."  The company points out that the NY bid is through an affiliate, Caesars Growth Partners.  CEO Gary Loveman (one of the smoother presenters that we saw last week) told the location board:
“This entity has in excess of a billion dollars of cash today on its balance sheet, it is very lightly levered and therefore has very sound financial circumstances. And this project, Caesars New York, would exist within the Caesars Growth Partners category. This entity would generate more than $200 million to the state of New York and its various local constituencies.”
But that maneuver has angered creditors, who have found themselves saddled with a weaker set of assets while potentially being on the hook for bigger losses if the company goes bankrupt or refinances its debt.  [City & State]
The piece also points out that Caesars was forced to drop its Massachusetts bid (in partnership with Suffolk Downs) in response to a report by state investigators that expressed doubt about the parent company's debt load, as well as a business relationship with a person with alleged ties to Russian organized crime.  The location board did not question the Caesars team about either of those situations; they skirted around the financial issue by asking generally about the situation in Atlantic City, and about the status of their financing.  Which, once again, raises the question of just how much preparation these guys did, or have done, for the task that lies ahead for them.


Anonymous said...

This takes the cake! I mean if the Indian casinos have daycare centers with toy slots, then the idea is planted to move up to elementary and middle schoolers!! Ugh-

David Giacalone said...

Thanks for pointing your readers to Stop the Schenectady Casino. As for our concerns over the Union College undergraduates, we are talking here about a $300 million casino less than one short block from the largest Union College residence hall, and only a few blocks from basically all non-grad students. This is not a question of taking your girlfriend or buddies to a tacky OTB Center or even tackier newsroom, much less driving 30 mils to Saratoga. In fact, you can take a short stroll and not even worry about DUI problems.

You have not been spending time with college kids lately if you're not aware of the poker craze. But, you surely remember all the complaints of there being "nothing to do in Schenectady." Well, Rush Street Gambling is definitely trying to give the UC students something to do (with their money) and something to borrow -- unlimited credit on markers.


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