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Best of Ken Adams

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Quicktakes: The month's trends at a glance - June 2005

9 September 2005

Summer is here, time to go on vacation, shop and, of course, visit your local casino. The price of gas following the price of crude oil shows new signs of returning to 2004 or 2003 levels. But so far that is having less effect on travel or the economy in general than one would have expected.

The AP reported that gas prices surged…tracking the steep climb in the cost of crude oil, according to an industry survey Sunday. Huston 2 News, 7-8-05

With the summer driving season under way, the average retail price for all three grades of gas hit $2.24 a gallon on Friday, up from $2.16 on June 10…. all-time high price of $2.276 per gallon reached on April 11 of this year. Auto Channel, 6-27-05

Americans went on a shopping spree last month. And they didn't bypass Wal-Mart.

Nearly across the board, retail sales increased in June, from luxury to midmarket to discount - from $200 bathing suits on Fifth Avenue to $2 plastic pool toys in the mall. The reasons were varied - hotter weather, hotter fashion, more markdowns, and less concern about gas prices than the experts had anticipated. Wal-Mart, the world's largest store chain, came roaring back from dismal sales and bad press in May to report increases of 4.5 percent in sales at stores open at least a year for its middle and working class customers, who rushed in to buy air-conditioners and summer clothes. …Another factor was consumer confidence, which hit a three-year high in June. "Normally those readings do not correlate…but they did in June." Other analysts credited the still-hot real estate market and the still-low mortgage rates, which yesterday stood at less than 5.25 percent for a 30-year-fixed-rate loan. Tracie Rozhon, 7-8-05

The unemployment rate dipped in June to its lowest level in nearly four years…the civilian unemployment rate dropped to 5 percent in June…lowest since September 2001…after hitting 6.3 percent in June 2003. Associated Press, Reno Gazette-Journal, 7-9-05

May gaming results reflect the same spending trends. With the exception of Detroit, all jurisdictions had increases in gaming revenues, ranging from .8 percent in Atlantic City to 6.5 percent in Louisiana. In June and July Mississippi may suffer from an early hurricane season, Detroit may profit from Canadian smoking regulations, but Atlantic City appears to be safe from Pennsylvania slot machines for this year at least.

Total May Illinois casino revenues were $154 million, a 3.6 percent increase from a year ago. Bob Okon, Suburban Chicago News, 6-8-05

Iowa May gaming revenues rose 6% to $96.3 million. Woinski's Gaming Industry Weekly Report, 6-10-05

Nevada casinos won $878.2 million …April…a 6.1 percent gain. Las Vegas Sun, 6-9-05

Gaming revenue at the New Jersey's 12 casinos came in at $420.2 million…up 0.8 percent over the same period last year. Donald Wittkowski, 6-11-05

The 11 casinos in Missouri had combined winnings of $128 million in May, up 3 percent. Christopher Carey, St. Louis Post-Dispatch, 6-14-05

The nine casinos in Illinois won $154 million last month, a gain of 3.6 percent. Christopher Carey, St. Louis Post-Dispatch, 6-14-05

Detroit May gaming revenues fell 2.3% to $106.1 million. Woinski's Gaming Industry Weekly Report, 6-27-05

Mississippi May gaming revenue rose 3.1% to $247.3 million. Woinski's Gaming Industry Weekly Report, 6-27-05

Louisiana May casino revenues rose 6.5% to $199.6 million with same store revenue up 2.3%. Woinski's Gaming Industry Weekly Report, 6-27-05

Indiana May gaming revenue rose 1.9% in May to $205.6 million. Woinski's Gaming Industry Weekly Report, 6-27-05

The World Series of Poker is just getting underway in the southern Nevada sun. As is fitting in the current resurgence of poker, it is being billed as the richest sporting event on the planet. Poker is being played everywhere around the country, not just in Nevada. Still it is appropriate for the super bowl of poker to be in the capital of gaming, Las Vegas.

The first thousands of poker enthusiasts from around the globe will begin descending on the Nevada desert today to compete for some $75 million in total prize money at the 36th annual World Series of Poker. The largest and most prestigious event of its kind, the World Series of Poker is expected to generate more than 15,000 player registrations by the time its main event begins July 7…The World Series of Poker is owned and operated by Harrah's Entertainment, Inc. ESPN, the tournament's official broadcast partner, will produce and air 26 hours of original programming based on the 36th annual World Series of Poker. The sports network will produce an additional six hours of original programming based on World Series of Poker Circuit events. Coverage is scheduled to begin airing on or about July 19. PRNewswire-FirstCall, 6-2-05

Jack Binion was inducted into the poker hall of fame. Probably no one person or family is more responsible for the status of poker. In all of the less that stellar years of poker around the country, Binion's Horseshoe kept the flame burning and established the World Series of Poker as the poker tournament.

Two legends of poker were inducted into the poker hall of fame yesterday, in a brief press conference/ceremony conducted on the ESPN stage in the main tournament room of the WSOP. Crandall Addington and Jack Binion were given poker's highest honor yesterday, and were inducted by the legend himself, Doyle Brunson…"Jack has been my best friend since, oh, about 1970" Brunson began as he wistfully recounted the days of Jack, and his Father Benny Binion founding the tournament that started it all. "If it wasn't for the Binions" Doyle continued "None of this would be happening." John Caldwell, Poker News, 7-7-05

Poker is everywhere: in pubs, clubs and casinos, but also in homes and offices, and on television and computer screens across the land. Tournaments are the bread and butter of the poker world. There are tournaments of average citizens and tournaments of celebrities, play in them or watch at home or in the center of town, ante up.

The Police Athletic League drew a pretty good hand at the Nautica Charity Poker Festival in the Flats, reaping $60,000 over eight days for its youth programs. That's a nice stack of chips for an organization with a $200,000 annual budget, said Bob Kumazec, a Cleveland police sergeant who is PAL's executive director. …PAL hosted the first two weeks of the weekly four-day event, which runs Thursdays through Sundays until Labor Day. Six other charities will be host for the remaining dates. Jacobs Investments, the event organizer, said in a release Monday that the 20,000-square-foot air-conditioned tent on the Flats' west bank drew more than 4,000 people downtown. Kaye Spector, Cleveland Plain Dealer 6-28-05

On Thursday, August 18, Bravo's hit original series "Celebrity Poker Showdown" will return for an all new tournament featuring twenty-five stars competing for $250,000 for charity. The tournament will consist of six all new, two-hour episodes. Poker pro Phil Gordon will once again team up with host Dave Foley as the stars ante up for another round of high stakes Texas Hold 'Em. … Players including Rosie O'Donnell, Penny Marshall, Peter Dinklage, Sharon Lawrence, Bryan Cranston and Eddie Cibrian compete for a quarter-million dollars for charity at themed tables such as Reality All-Stars, Ladies Night, Boys Night Out, And Rosie & Friends. Futon Critic, 7-7-05

Nor is your local movie theater without its poker option. With all of the attention, how long can it be before poker is declared to be the national pastime, or an Olympic sport. After baseball was dropped from the Olympic games, there is room for a new game.

When you go to your local multiplex, you might expect to see Robert Duvall (The Godfather), Drew Barrymore (Charlie's Angels) and Eric Bana (Troy) on the silver screen. But in 2006, poker fans will be able to see more than two dozen of their favorite poker icons sharing the screen with these three Hollywood stars. …Curtis Hanson (L.A. Confidential, 8 Mile, Wonder Boys) directed Lucky You from an original screenplay he co-wrote with fellow Academy Award winning screenwriter Eric Roth (Forrest Gump, Ali, The Insider). The film explores the story of a professional poker player (Bana) who gets a lesson in life from a struggling singer (Barrymore) as he collides with his estranged father (Duvall) in the world of high stakes poker in Las Vegas. "With millions of people watching poker weekly on television, it was important to capture the authenticity of the game and its players," said Hanson. "To that end, the poker tables in 'Lucky You' are primarily populated by poker players, not actors pretending to be poker players. Our stars trained for months in order to convincingly play side by side with top poker professionals cast in fictional roles." Press Release, Casino City Times, 7-6-05

The Internet has been a major force in the growth of poker. Playing online develops players' skills. On the other side, government pressure to stem the tide of internet gaming has not lessened. There is no clear solution at the moment. The World Trade Organization's decision only further complicates the story. The only certainty is the Internet and Internet gaming are not going away. In London the long anticipated and very successful IPO of Party Gaming took place, without regard to the threat of American enforcement.

London's biggest stock market flotation for years has been overshadowed by advice from Washington that the four-dotcom millionaires behind the venture risk arrest and prosecution in the United States. PartyGaming, operator of a hugely profitable poker website, is expected to be valued at £4.76bn when it floats on the stock market in 11 days' time… While the company's activities are legal in the UK, the US justice department is warning that operators of online gambling enterprises could be prosecuted and, if convicted, jailed for years in America…The company denies that it is due to concerns over the legal position in the US, and insists that the company's founders want only to lead normal lives after the flotation. The justice department's warning is likely to increase anxiety among US investment institutions, some of which are reported to be reconsidering whether to back PartyGaming…A senior justice department official told the Guardian: "Any business offering online gambling services that are in the United States or can be accessed in the US are illegal… PartyGaming disputes the justice department's interpretation of the law in the US, and said yesterday that no company offering similar online gambling services had ever been prosecuted there. Ian Cobain, Manchester Guardian, 6-17-05

The WTO decision created an instant coalition of states. Lead by Utah, 28 states see this as a states' right issue and are motivated to fight, though it isn't clear what their options are, except to make sure that Congress knows their feelings. Indiana passed its own law prohibiting Internet gaming.

In the wake of a World Trade Organization decision that throws into doubt Utah's ban on Internet gambling, Utah Attorney General Mark Shurtleff and 28 other attorneys general have written a letter to U.S. Trade Representative Rob Portman calling for a greater states' voice in future trade talks. "Antigua has no business trying to write Utah's gambling laws," Shurtleff said Tuesday. "The Trade Representative needs to know that we have too much at stake to remain silent." …Shurtleff and Vermont Attorney General William Sorrell solicited the other attorneys general to sign the letter requesting more dialogue with Portman on trade issues, especially when they affect state rights. The letter says the trade representative should have done more to stop the World Trade Organization from ruling that gambling should be treated like "other recreational services." The attorneys general are urging Portman to withdraw gambling from the trade agreement. They say the trade organization could ultimately stop all gambling regulations involving casinos, slot machines, state monopoly lotteries and Indian gaming rights. Shurtleff said the ruling could also hamper a state's ability to regulate advertising, Internet spam and even zoning laws. "We believe that under our constitutional system of federalism, states should continue to have the flexibility and sovereign authority to determine whether and under what conditions gambling occurs within their borders, without such decisions being second-guessed by WTO tribunals," Shurtleff wrote. Jerry Spangler, Deseret Morning News, 6-8-05

Television Games Network no longer does business in Indiana effective Friday when a law went into effect that makes operation of an Internet gambling site, unless allowed by statute, a felony. Indiana previously had laws that limited Internet gambling, but violating such a law was only a misdemeanor. Senator David Ford (R-Hartford City) co-authored the bill with the intent of giving the state more control over gaming. "[Internet wagering providers] have known it's been illegal," Ford told the Indianapolis Star. "They just winked at the law. Now this puts a little teeth in it." The law passed in quick order in April with the state House voting 74-21 in favor and the Senate approving it 46-0. Signed into law by Governor Mitch Daniels on April 25, the measure became effective on Friday. Thoroughbred Times, 7-1-05

There appears to be only one vocal proponent for Internet gaming, the racehorse industry. A significant percentage of track wagering revenue comes via offsite wagering and, except for slot machines, nothing else offers the industry much of chance of surviving the competition from other forms of gaming. Racing gets caught not because you can watch racing and bet online, but by the fact the wagers and information are transferred by wire and wagers are paid the same as one pays Internet wagers. The industry would like an exception.

The Congressional Horse Caucus, now more than 60 members strong, said it supports efforts to stop illegal Internet gambling but said any proposed legislation must be clarified to protect legal pari-mutuel account wagering and simulcasting. Draft legislation to ban financial transactions tied to Internet gambling has resurfaced on Capitol Hill. Arizona Sen. Jon Kyl, who proposes the legislation, has sought to ban Internet gambling since the late 1990s. The pari-mutuel industry has been able to get language included that protects account wagering, but the latest bill doesn't exempt the industry from the ban… The Congressional Horse Caucus, in a May 31 letter to Kyl, said it believes illegal, offshore Internet gambling takes revenue away from "licensed, regulated U.S.-based wagering, including wagering on horse races." The caucus said the draft legislation as written would have the "unintended consequence of block payment processing for account wagers conducted pursuant to the Interstate Horseracing Act, which Congress clearly intended to be legal." The caucus acknowledged the U.S. Department of Justice position that account wagers violate the federal Wire Act even though Congress amended the IHA in 2000 to clarify that pari-mutuel wagers could be made via telephone or electronic means. …The caucus asked Kyl to consider that previous versions of legislation to ban Internet gambling included "clarifications" for pari-mutuel wagering. It said such clarifications--the word exemptions isn't used in the letter--"are obvious steps to implement what has clearly been Congressional intent for several years, and we strongly urge you to include such provisions in your bill." Tom LaMarra, Blood Horse News, 6-9-05

To avoid the fracas, some Internet sites may be moving to Central America, which is governed by different treaties than the WTO agreements.

Online casinos may have found a way to get around any ambiguities left after the WTO decision. While the American government may be able to prevent Americans from playing at online casinos based in Antigua, the Central American Free Trade Agreement may prove a more formidable foe. Unlike the WTO agreement, the CAFTA agreement does not have any "public morals" clause. The federal government is unconcerned, saying that even if online casinos move to Costa Rica or other Central American nations, states will still be able to impose their own gambling laws in order to prevent their residents from playing at online casinos. This is as a result of a grandfather clause which states that existing laws would not be displaced by CAFTA. Authorized Online Casinos, 7-5-05

Government pressures are not the only thing affecting Internet gaming; lawsuits are also adding to the problem. Looking for deep pockets, two gamblers in California filed suit against Google because they were snared by Internet casino advertisements. Their auditors dropped Lakes Gaming and WPT due to their association with Internet gaming.

Yahoo! Inc., Google Inc., and other Internet search engines lost a bid to dismiss a lawsuit filed by two gamblers over advertisements promoting online casinos. California state Judge Richard Kramer in San Francisco ruled that the suit, filed against Google, Yahoo, Ask Jeeves Inc. and 10 other search engines and Web sites, can proceed with the evidence gathering process in the case…The two gamblers, Mario Cisneros and Michael Voight, used sponsored links at search engines or Web sites to find online casinos where they lost money, Rothken said…Yahoo made as much as $12.97 for each person who clicked on ads directing them to illegal Internet gambling Web sites, said Rothken. Most of the companies have stopped the placement of the advertisements since the lawsuit was filed, he said. Joel rosenblatt, Bloomberg News, Las Vegas Sun, 6-7-05

Local accounting firm Deloitte & Touche has decided not to seek re-election as Lakes Entertainment Inc.'s independent auditor due to the company's involvement in online gaming, according to a Securities and Exchange Commission filing…Minneapolis-based Deloitte previously resigned as the independent auditor for WPT Enterprises Inc., a majority-owned subsidiary of Lakes Yahoo! Finance, 7-8-05

However, the pressures, threats and difficulties have not stopped everyone. PartyGaming did go public and raised close to $10 billion. And although Deloitte & Touche don't want WPT, someone does and is willing to pay a pretty penny for it. Wouldn't that have been a good day to own WPT stock?

The Shares of PartyGaming PLC, the world's biggest online-poker company, rose 11 percent in their first day of trading Monday on the London Stock Exchange despite concerns of a possible crackdown on Internet gambling in the United States, where most of its players reside (87 percent)…valuing the company at 4.64 billion pounds ($8.46 billion). Associated Press, New York Times, 6-28-05

WPT Enterprises Inc., known for its televised World Poker Tour tournaments, said Friday that it received an unsolicited offer to purchase the company for $700 million. WPT shares shot up $10.45, or 59 percent, to a new 52-week high of $28.20 on the Nasdaq -- trading at more than 23 times average volume -- before recently being halted. The company's majority owner, Lakes Entertainment Inc., also saw its shares soar before trading was halted. Lakes Entertainment climbed $3.85, or 26 percent, to $18.70 on the Nasdaq, on more than 10 times the average trading volume…Earlier today, a New York Post article disclosed that poker star Doyle Brunson, 71, and a team of backers launched a $700 million bid to acquire WPT. Associated Press, Yahoo! Finance, 7-8-05

Which brings us back around to poker. Poker and the Internet are not the same thing, but their destinies are very closely woven. So this last poker article is a fitting place to end this month's poker story: poker robots. There was the famous chess-playing computer, now we have the poker playing one. Line up for your chance to beat the computer, though I don't think it pays as much as beating the best in Vegas in July.

A number of techies are trying to develop successful online poker bots, designed to outwit fellow players in the online poker room. While bots have successfully been created for games such as checkers, chess and backgammon, poker poses a further challenge to artificial intelligence specialists as poker features a psychological component that makes quality simulated play more difficult to achieve. Still, computer pros seem to be up for the challenge, with more and more online poker robots constantly going into development. Next month, Las Vegas will even host an online poker bot tournament, in which coders will have their programs go up against each other in a round of tournament poker. Online Poker News, 6-13-05

The temperatures are heating up, so are the gas prices. Still things look good for gaming for the summer, even without slot machines in Pennsylvania or Florida. Poker is moving to the front and center of the stage as the world looks to Vegas and the World Series of Poker, drawing thousands for a $100 million in prizes. Television will once again familiarize the entire country with the players and increase the aura of the game. That excitement will foster more and more poker around the country, in some cases pushing legislative change. Behind the poker story is the Internet gaming story. The Internet may not get drawn along like poker, nor will it always get such a friendly or acceptable image as poker is getting; still, it is being brought along in poker's wake, and in some way, poker is going to help Internet gaming's cause.
Ken Adams

Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
Ken Adams
Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.