FOR CASINOS, ESPORTS IS A GAME-CHANGER
The Agua Caliente chain looks to cash in on the demographic shift in its business model
Southern California casinos are filled with classic table games and flashy slot machines where customers can take a shot at a fortune. But betting on these staples of chance, which continue to be the center of gaming in the casino business model, may not be the most certain wager.
Enter brothers Ari and Ben Fox, who have worked on several projects for more than 20 years that seek to increase the flow of visitors into casinos around the country. Their latest venture is to incorporate an aspect of gaming that’s usually done remotely: video gaming.
“Many years ago, we saw that there would be a decline in the older generation visiting the brick and mortar casinos,” Ari Fox said in a recent phone interview. “Our answer is to give the younger people what they’re looking for, and what they’re looking for is much more of a skill-based system where people could play against each other on a peer-to-peer platform.”
That skill-based contest drives the competitive and organized video gaming world of esports, a lucrative market that attracts not just players vying for high-dollar cash prizes, but sizable audiences that rival those of traditional sporting events. Esports has fueled the rise of influencer platforms such as Twitch, where fans can watch their favorite players compete. A report by Statista estimates that by 2025 there will be over 318 million esports enthusiasts worldwide, a significant increase from the 215.2 million in 2020.
The Fox brothers started the Casino Esports Conference to spread the word. This gathering brings together local legislators, tribal leaders, developers, affiliates, gamers, and engineers to discuss the future of video game integration into casinos. The eighth iteration of this event is coming to Southern California’s Agua Caliente Resort Casino Spa Rancho Mirage on March 19-21. Programming for the event includes keynote speakers from the world of esports, casino gaming and technology, as well as workshops and panels.
Building a gaming lifeline
Ari and Ben Fox also have a background in video games as the creators of Gameacon, a convention at the Palm Springs Convention Center in June. The event, which has been around since 2015, hosts professional and casual gamers and creators and attracts comic book, anime and pop culture enthusiasts, among others. Ari Fox said the worlds of casino and video games have overlapping similarities.
“We realized that the adrenaline that people get from slot machines, trying to get that bonus or trying to get the win, is similar to video gamers, but the video gamers have a different goal,” he said. “Their goal is to win the next level(s), so there’s a way that you can connect the two by giving them something that’s more interesting for them to do.”
Ben Fox added that Generation Z and millennials play video games for other reasons as well, such as for monetary gain or for status earned from experiences beating other players.
“You really don’t have to stretch the imagination too far to basically provide gaming that’s already there,” he said. “You just have to monetize it so that it becomes a business that entertains but also makes money for the property in order for it to sustain itself. We’re not talking about new creations or new things. All we’re really doing is trying to give them the tools and teach them how to use what’s already out there and implement it within a casino environment.”
Remote gaming vs. in-person gaming
The world of video gaming has always had a social component, whether it was at the arcade playing side by side or even facing off against others at home. The internet further revolutionized social interactions in video games by allowing players to make friends and play online with people from around the world.
The debate on whether esports is better in person or remotely is similar to the discussion around sports betting in California. The question in consideration asks whether patrons won’t consider participating from the convenience of their home rather than making the trip in person.
Gary Denham, CEO and founder of Wamba Technologies, is working on releasing an esports wagering platform dubbed Gamers Oasis. Denham was awarded a patent that will allow video gamers to enter a tournament on a mobile device for a fee and compete against others in sports, racing, first-person shooters, fighting games and more, for cash. It will allow players to enter through a game’s interface rather than using a third-party website or registration to compete.
“If a video game player wants to compete against other players to win money, whether it be one-on-one or in a multiperson tournament, they usually have to travel to an arena or a venue to compete,” Denham said. “Many people can’t participate due to travel costs or lack of accessibility. Gamers Oasis will allow everyone to compete for real money, directly from their phones, without needing to travel.”
Denham notes that another reason people compete in person is to ensure they are facing off with other verified players and that no cheating will affect the outcome. He said he and his team are looking to address these issues by authenticating players based on their experience level and enabling them to use their front-facing mobile cameras or other devices when the company eventually adapts its platform to console gaming.
“It’s only when money gets factored in that they’re traveling because of the inherent problems I just described,” Denham said. “If these players had a solution where the competition options were built right into the game and they felt comfortable and confident in that, they’re going to compete from their own homes just as they do when they’re playing for fun. They just haven’t been given that option yet, and that’s exactly what Gamers Oasis is going to be providing.”
Ben Fox said he and his brother’s experience hosting Gameacons shows sports betting lacks that esports has, which is an established history. He said players can already compete online remotely but are choosing to come in person: the opposite of what sports gamblers do in other states, where betting online remotely is legal, causing fewer people to frequent sports books housed at casinos.
“With esports it works in the opposite way,” he said. “They qualify online and they do show up for the social aspect in person. It’s a behavior where those two worlds do work effectively online, and it already existed before they even started having tournaments or meeting up for social events or casual play. It’s a reverse model, but it does work effectively.”
He and his brother emphasize that some of the success of esports is driven by the desire of social interaction, which has been exacerbated by the disruptive force of the coronavirus pandemic. A Met Gala Poll released in October conducted in 142 countries found that nearly 1 in 4 adults feel lonely. Another significant find was that the rates of loneliness were highest in young adults, with 27% of Gen Zers and millennials ages 19-29 reporting feeling very or fairly lonely.
Ben Fox said hosting these events could provide social interactions like going out to a bar or a concert with friends and can encourage gamers looking to meet in person.
“You’re talking about generations that just came out of COVID where the majority of their interactions were online,” he said. “They’re crying out for social interaction, and casinos are in a place to provide that.”
Southern California’s new esports frontier
Casinos in Las Vegas; Atlantic City, New Jersey; and Southern California have started to incorporate esports into their entertainment offerings. Agua Caliente Rancho Mirage and Agua Caliente Cathedral City continue to host weekly video game tournaments, where visitors battle head-to-head in popular titles such as Super Smash Bros., Mario Kart and Street Fighter V for prizes.
Pearl Aguinaldo, vice president of marketing at Agua Caliente Rancho Mirage, said there has been an increase in traffic to casinos from the esports events. Aguinaldo became increasingly familiar with the subject, thanks in part to her attendance at the Casino Esports Conferences in Las Vegas, and said she felt Agua Caliente Casinos could benefit from working with the Fox brothers to bring the event to Southern California.
“We are very active in the community, and we want to make sure that when we present anything to the esports world, it is authentic and resonates,” Aguinaldo said. “So when Ari and Ben Fox said yes, it worked because we were also able to elevate the different experiences of the audiences that come to these conferences and allow them to visit our tournament, which will be held during the esports conference in Cathedral City.”
David Heath, general manager of Agua Caliente Rancho Mirage, said esports competitions at the property have brought in younger guests who he and the casino hope will become returning visitors, and who may not be familiar with other attractions offered at the properties such as dining or entertainment.
“We welcome the new clientele and the esports clientele,” Heath said. “It’s a new dynamic to hopefully have this group come to our property again and learn about us as we learn about them. So for us, we’re not shying away.”