Technology changes rise to the forefront at this year’s G2E

The two keynote speakers at last year's Global Gaming Expo angered half the audience. This year's addresses are sure to infuriate the rest of the crowd.

The gaming industry enters its largest annual conference and trade show at a crossroads concerning technology. A portion of the gathering later this month at the Sands Expo and Convention Center is devoted to addressing how much the industry will embrace the fast-changing technological world as casinos evolve in the 21st century.

We're not just talking about the debate over legalizing forms of Internet gaming in the U.S. This year's G2E is moving far beyond that topic.

On the conference's opening session, analytics, innovation, and data expert Jeffrey Ma will give gaming industry leaders insight on harnessing technology-driven platforms built to optimize performance, improve customer loyalty and increase overall success. Two days later, Rahul Sood, CEO of Unikrn, a Seattle-based gaming company focused on eSports, discusses his ideas on bringing design, technology, and business together to create products.

Compare these two speakers to last year's keynoters.

Wynn Resorts Ltd. Chairman Steve Wynn gleefully told the G2E audience how happy he was to own a new iPhone 6 and then proceeded to bash Internet gaming. He said a public relations crisis surrounding the activity would lead to increased regulation and oversight of land-based casinos. A day later, Las Vegas Sands Corp. Chairman Sheldon Adelson continued the online gaming beat down, telling G2E the activity can't be regulated to protect children from gambling online and unfairly targets poor people.

The Wynn and Adelson remarks weren't welcomed by the Internet gaming crowd, as sure as the casino old-timers aren't going to like what Ma and Sood have to say.

Technology and casinos have not always had a smooth marriage. The gaming industry has historically been slow to welcome technological changes.

In the early 2000s, Station Casinos executives blamed poor quarterly results on slot machines provided by International Game Technology, which were outfitted with ticket in-ticket out systems. The casino company executives said their customers — predominately senior citizens — did not understand how cashless gaming worked.

Ticket in-ticket out slot machines are now common. The same is true for player loyalty/customer tracking efforts. Gaming executives scoffed during the early stages of Harrah's (now Caesars) Entertainment Corp.'s industry-changing Total Rewards program. Today, all casino companies offer customer loyalty awards. Players are credited points for gambling, but also for spending in restaurants and other noncasino areas.

Ma — best known as a principal behind the card-counting exploits of MIT students outlined in the book "Bringing Down the House" and the movie "21" — founded four tech companies. TenXer, his analytics tool designed to optimize employee performance, was recently acquired by Twitter.

Times are quickly changing in the gaming industry.

People are increasingly playing social games on their smart phones. Eilers Research estimates the social casino market grew into an $821.1 million business in the first half of 2015, a 1.1 percent increase in the second quarter and up 20.8 percent in the past 12 months.

Revenue and anecdotal information show casino customers don't always gamble at destination resorts, regional casinos, or locals properties, but often spend on other entertainment.

On the Strip, the Gaming Control Board said casinos collected almost 65 percent of their overall revenue from nongaming attractions during the last fiscal year. The Las Vegas Convention and Visitors Authority said 71 percent of tourists who visited the Strip in 2014 gambled, down from 80 percent just four years earlier.

This past weekend, college seniors (age 21 and over) from the fraternities and sororities at my daughter's university invaded the Strip for the three-day holiday. They stayed in hotel rooms, ate in the restaurants, and partied at the day clubs and nightclubs. My daughter said most of the guys and a few girls gambled at blackjack or craps after leaving the clubs. No one touched a slot machine.

Nevada hopes to boost slot machine play through new regulations allowing games to contain a skill-based element. The Control Board approved the legal wording last week and the Nevada Gaming Commission could sign off on Sept. 17, putting the rules in place just as equipment manufacturers are unveiling their newest games at G2E.

The industry might be wise to consider what the tech guys have to say.

Howard Stutz's Inside Gaming column appears Wednesdays and Sundays. He can be reached at hstutz@reviewjournal.com or 702-477-3871. Find on Twitter: @howardstutz