The dynamics of the Asian gaming industry are shifting, bringing the Philippines market into the spotlight for its significant growth potential, especially in the electronic gaming machine (EGM) sector.
In an exclusive interview with AGB about Paradise Entertainment’s Asian expansion plan, Jay Chun, co-chairman and managing director of the group, notes the company’s focus is on the Philippines market. The Philippines already holds the title of the largest EGM market in Asia, offering great flexibility with numerous casinos and a variety of gaming types. Chun believes that the slot machine count in the Philippines will “double” in the foreseeable future.
He points out that while Macau has 12,000 slot machines, the Philippines boasts 23,000 slot machines and 25,000 bingo machines, making it the leader in Asia for Electronic Table Games (ETG). According to Chun, strong domestic demand and the popularity of bingo games will drive market growth. He expects the Philippine market size to surpass 50,000 slot machines.
Chun considers 50,000 slot machines as “normal,” citing the United States with over one million game machines and over 100,000 in Australia. He believes that the Philippines market still has substantial growth potential.
Currently, Paradise Entertainment has already partnered with local businesses in the bingo machine sector, with plans to introduce new products to the Philippine market soon.
Chun also mentions that Macau has set a maximum of 12,000 slot machines, limiting further growth. Industry suppliers in Macau are now focused on replacing old machines or engaging in maintenance businesses. And the slot machine replacement business volume has been lower than before.
On the other hand, Chun points out that the Philippines market is more international compared to Macau. It adheres to general standards for gaming machines, aligning with global norms, whereas Macau has its own standards. In this context, Chun notes, “any game invented for the Philippines market can still be promoted worldwide.”
The Philippines Amusement & Gaming Corp. (PAGCOR) approved version 1.1 of the PAGCOR Technical Standards for Electronic Gaming Machines (PTS-EGM) in mid-2023. The new PAGCOR EGM Technical Standards will take effect on January 1st, 2024.
According to figures released by PAGCOR, revenue from slot machines business in PAGCOR-operated casinos reached PHP 8.5 billion ($152 million) in 2022.
Bingo Operations generated over PHP 20 billion ($358 million) last year, while electronic games’ revenue also reached PHP 8.1 billion in 2022.
Based on a study from Technavio, the Philippines’s land-based casino gaming segment is estimated to witness significant growth from 2023 to 2027. ‘The land-based casino gaming segment has been a crucial source of entertainment for many consumers in the market in focus. Land-based slot gaming has become a popular tourist attraction in the Philippines over the past decade, with many travelers coming from across the globe for an experience of excitement and luxury offered by these casinos,’ it writes.
Macau
Paradise Entertainment is a Hong Kong-listed company that engages in the development, sale, and leasing of electronic gaming equipment and systems, as well as the provision of casino management services in Macau.
The company is also the inventor, patent owner, and sole provider of live multi-game terminals, dominating the electronic table games market in Macau.
Macau has extended the EGM Technical Standards 2.0 compliance deadline until the end of 2026. Speaking to AGB, Jay Chun confirms that all of Paradise’s products have already complied with Technical Standards 2.0.
“It’s not hard to implement since Standard 2.0 has been launched for a while. I believe the industry’s companies are almost done with it,” he notes.
Regarding the Macau recovery, Chun indicates that Macau had a better-than-expected recovery, while his casino, Kam Pek Paradise, “performed well.”
According to the company’s interim financial report, Paradise Entertainment reported revenue increased by 36.2 percent year-on-year to HK$246.7 million ($31.6 million) in 1H23. The total gross gaming revenue (GGR) from Casino Kam Pek Paradise increased by 55.2 percent year-on-year to HK$439.5 million ($56.3 million) in 1H23.
