Casinos going online, using Facebook to recruit new players

Facebook could shape the future of the Strip.

As gambling expands overseas and Las Vegas diversifies as a tourist destination, casino operators are looking to online gaming as a way to attract new customers and increase profits.

Casino honchos are betting that virtual bingo, digital slot machines and games that resemble Farmville, the popular Facebook game, will be the key to the Strip’s vitality. Most of the games don’t involve betting or real money, but they whet players’ appetite for gambling and familiarize them with casino brands.

And they hope to promote those games, and ease people into real online gambling, via Facebook.

Over the past year, almost every major casino company has bought or partnered with an online game developer.

"Operators are coming together saying, 'Here is this transformational opportunity; let's collaborate,'" said Rob Bone, senior vice president of WMS Gaming.

Caesars Entertainment bought Playtika, the Israeli developer of Slotomania, a Facebook slot machine game. MGM partnered with Playstudios to launch myVegas, a Facebook application coming this summer that allows people to play blackjack or slots. Boyd Gaming and MGM invested in Bwin.Party Digital Entertainment, which designs online poker and social gaming.

And last fall, Fertitta Interactive, an offshoot of Station Casinos, bought CyberArts of San Francisco. The acquisition allowed Fertitta Interactive to develop Ultimate Poker, which debuts today on Facebook. The company also owns an online bingo game.

The rationale behind the mergers is simple: If companies can hook players online, they can lure them into brick-and-mortar resorts.

"At some point, part of that audience is going to say, 'I want to play for real,'" said Andy Choy, president and chief executive of the Riviera. "They may say, 'I've won all these virtual prizes. How about some cash?'”

Online gambling is legal in Nevada but not nationwide.

In May, the Riviera partnered with Bingo Blitz, a free online bingo platform with 3 million players monthly. Choy said he hopes the collaboration raises the Riviera’s profile.

“Hopefully, there’s some cross over between people who play the game at home and vacationers who are planning to come here,” Choy said. “The hope is they will have a positive view of the Riviera from playing the game online."

Bingo Blitz’s online bingo parlor attracts players who likely would never step foot in a real bingo parlor. Almost half of Bingo Blitz’s audience is between 18 and 34, decades younger than the blue hairs that typically favor the game.

"It's really about supply and demand,” said Salim Mitha, vice president of Buffalo Studios, the game’s developer. “Las Vegas has always had the supply. I think we can help create more demand."

A similar thought process went into the development of Margaritaville Online, a virtual 3D world similar to Farmville in which players can build and design beach resorts, fish from customized boats and drink margaritas.

Farmville has amassed a strong following of middle-aged women, moms with time to spare and money to spend. By copying the Farmville model, Caesars Entertainment and the Margaritaville brand hope to hook a similar demographic. If they fall in love with Jimmy Buffett’s virtual world, they’ll be more inclined to visit the real one tucked into a corner of the Flamingo. Margaritaville Online debuted shortly after the Flamingo, owned by Caesars Entertainment, introduced its Margaritaville mini casino.

Fertitta Interactive is eyeing a different population with its online brands. It wants to tap into the popularity of Ultimate Fighting with its Ultimate Gaming interactive brand. The company plans to advertise the venture during UFC fights. Frank Fertitta III and Lorenzo Fertitta own the UFC, Fertitta Interactive and Station Casinos.

Market research has shown that the people who watch UFC — primarily men in their 20s and 30s — are the same people most attracted to online gaming. They are an audience worth billions of dollars, Fertitta Interactive Chairman Tom Breitling said.

WMS is bridging the virtual world with the real one by developing online versions of its casino games that allow players to earn credits online that they can then apply on the casino floor.

Close to 1 million people have signed up for PlayersLife. A million more have registered over the past six months for WMS' Facebook slot game, "Lucky Cruise." Last week, WMS acquired Phantom EFX, which develops interactive and mobile slot games.

"You can't go from a physical gaming environment straight to online gaming,” Bone said. “You have to have that intermediary step where you're creating communities of people and engaging with them. Then you go into a more monetary online gaming format."

"Online is about accessibility for the player, " he continued. "I think people are very fearful that once online flips over, all these beautiful buildings on the Strip will have a shelf life of five to 10 years and everyone will have moved online. I think the goal is to find out how they coexist, how do people move from one place to the next. Capture them online, and get them to redeem an offer at the casino."

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