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Sheldon Adelson’s Real Agenda

Posted by Matt Kaufman March 26, 2014

At last week’s iGaming North America conference at Planet Hollywood in Las Vegas, Caesars Acquisition Company and Caesars Interactive Entertainment CEO Mitch Garber debated Las Vegas Sands’ VP of Government Relations Andy Abboud. The focal question for the debate was “is online poker/gambling the problem or the solution?”

In front of a crowd of a few hundred individuals, almost all of whom have business interests in the iGaming sector, Mr. Abboud set off to defend the stance of Sands majority shareholder Sheldon Adelson, who has taken a staunchly anti-iGaming position despite having made billions of dollars from land-based casino gaming. His logic echoes many of the concerns typically heard from anti-gambling groups. This frequently seems quite hypocritical for the obvious reason that Mr. Adelson still runs casinos.

Garber, on the other hand, was there to defend a more consistent position – that Americans should be allowed to spend their money how they please, and that activities which are legal should all be made legal to do online assuming the technology exists to police those activities.

The overwhelming consensus from conference attendees was that Garber clearly won the debate – but then again, what else could a room full of iGaming advocates possibly have said?

We’re Being Distracted

I personally find the constant criticisms of Mr. Adelson’s position from the pro-gaming community somewhat misguided. Adelson, and sometimes Abboud in his place, speaks of the moral dangers that bringing gambling into homes can have. He talks about technology which is unable to prevent problem gamblers from losing their homes. He talks about how kids will find ways to gamble using their parents’ credit cards.

In response to what he says, we all talk about why he’s wrong about each of those points. But very infrequently do we consider why he’s really doing this.

Las Vegas Sands is the largest casino company in the world by market cap, and for decades Mr. Adelson has been a shrewd businessman in guiding their operations. I suppose it’s possible that his hypocritical public stance is truly what he believes, but I’m MUCH more willing to believe that he has ulterior motives. So what are they?

Adelson’s Reasons

Adelson recognizes that the industry is expanding in two directions – Asia and the internet. His biggest competitor, Caesars, seems to have a grip on the internet. It seems somewhat reasonable for him to want to slow down or halt the progress of iGaming expansion purely to prevent his competitors from reaping the benefits. After all, he’s already the biggest beneficiary of the more important Asian expansion anyway.

Further evidence supporting this concept is that Caesars isn’t exactly doing very well. I won’t pretend to be an expert on their finances, but it seems unlikely that they can bury themselves deeper in debt for a whole lot longer without doing something significant about it. If you’re Sheldon Adelson and flush with cash, it’s pretty nice to stand by and watch the competition drown. If you see the likes of Caesars trying to take advantage of a new market, you may feel it’s worthwhile to get in their way – even if it means you can’t participate in the new market yourself.

If Adelson’s opposition to iGaming manages to slow down the industry to the point that Caesars is legitimately hurt by it, it may even prevent them from competing with him in the convention business which has done so well for him. Any corporation would prefer to hold an event at a frequently-upgraded Sands convention center compared to Caesars properties which without influxes of cash will be in need of renovations.

Finally, Adelson may even receive some positive social and political benefits from deciding to fight internet gaming. It certainly can’t hurt for the billionaire casino mogul to appear to be caring and to have a set of ethics he’s unbending on. Who might this help him gain the favor of? It’s tough to say specifically, but Asian regulators or governments seem like less-than-outlandish answers.

It’s also completely possible that I haven’t touched upon the real reasons at all. Even if that is the case, it still doesn’t change my primary point – there are almost certainly reasons for his opposition which likely haven’t been exposed publicly. If the pro-iGaming community can get a real gauge on what those reasons are, it will be a whole lot easier to expose the reasons he states publicly as attempts to distract us from his true motives.

About Matt Kaufman

Matt Kaufman is Editor-in-Chief of QuadJacks.com and an advisor at Z4 Poker.

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There are 2 Comments

  1. Pingback Boo Sheldon Adelson! | PokerXanadu – All Things Poker

  2. - March 27, 2014
      -   Reply

    Matt, Sheldon’s *real* reasons are not Caesars Entertainment, but something that he said himself directly to Nevada’s #1 political journalist, Jon Ralston. He said, and I quote from the Politico article:

    “If web gaming is legalized, the self-made multibillionaire and mega-donor insists, big-name Silicon Valley companies will invest heavily in the business, eventually coming to dominate the market with their superior technology and global reach. States will smell money and levy taxes. And then it will happen: the apocalypse, sayeth the Cassandra of gaming soothsayers, who is putting his fortune where his crystal ball is.
    “Somebody like Google or Facebook, they’ve got a billion customers hitting them every day,” marveled Adelson, who chairs Las Vegas Sands, which owns the Venetian and the Palazzo on the Las Vegas Strip, in a lengthy recent interview. “They’ll come in there, they’ll squash the other guys like … you squash the little ant running across the table or the floor and that’s going to be the end of all of it.”

    So it’s Facebook and Google, not Caesars or MGM that’s keeping him awake at night…

    Read more: http://www.politico.com/magazine/story/2014/02/sheldon-adelson-internet-jihad-103461.html#ixzz2xD1ZmQ5Y

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