Jackpot! Atlantic City Tosses Gambling and Wins
Matt Chaban Nov. 2, 2010, 9:56 a.m.
Few things in life are free, even in Atlantic City these days, where those once all important comps are on the way out. It’s not that the casinos can’t afford to do it, but they are actually making quite a bit of money not giving the milk away but making gamblers and non-gamblers pay instead–a strategy that may be pointing to a new, non-gambling future.
The original sin city, and long the East Coast’s capital of casinos, this Jersey burg has had a hard go of it the past decade or two, but is angling for a comeback, as The Observer chronicled in a recent cover story.
With suburban gambling becoming more common in more places, declines in gambling revenue were to be expected. The real challenge is whether Atlantic City can capitalize on its historic strengths as a classy beach town to salvage itself.
It looks like things are finally turning around, at least according to a study by the Spectrum Gaming Group, which reports the surprising fact that while gambling revenues are shrinking in Atlantic City, non-gaming receipts for things like food, drinks and hotel rooms are on the rise. In this regard, in fact, Atlantic City is even beating out some of its rivals in places like Vegas and Mohegan Sun in Connecticut.
While the AP points to at least one tourist who was lured to Atlantic City by the appeal of Boardwalk Empire–and a straight razor shave, just like his daddy used to get–it seems that most of the gains are coming from squeezing visitors for more money.
The number of comped rooms are down from 65 percent to 60 percent between 2007 and 2009, and at Harrah’s alone, that amount has sunk from 86 percent to 59 percent over the same period. Free meals across the city are down 29 percent and free drinks 16 percent, all of which is accounting for more money in the till if not the slots.
Overall, gambling receipts are off 23 percent from the boom’s peak to the recession’s trough, while at the same time hotels have risen 21 percent and comestibles 6 percent. In Vegas, non-gaming receipts fell 1 percent over the same period.
The study dates to 2009, a year before the HBO hype even began, so the surge can’t be explained by a Boardwalk Empire bump. Perhaps that could spur even bigger gains this year and next, maybe even leading to an uptick in gambling as well as everything else.
Or maybe this just means that with money tight, people would rather save on the expensive tank of gas, which they can then pour into, say, the new casinos just opened in Philadelphia and Pittsburgh. Now, when it’s time to splurge, it’s time for Atlantic City.