Domestic casinos face intense competition from international and online casinos, particularly for premium and VIP gamblers
Melbourne, Australia (PRWEB) July 12, 2014
Casinos in Australia have grown over the past five years, despite rising competition from international and online casinos. Revenue is estimated to increase at a compound annual 2.9% over the five years through 2014-15. Greater per capita gambling expenditure has assisted financial performance, with consumers demanding more gaming services. Rises in discretionary income levels have also assisted revenue growth, as patrons have spent more money on non-essential items such as casino gambling services. Revenue is estimated to grow by 0.4% in 2014-15, to reach $5.6 billion. The industry's two largest players, Crown and Echo Entertainment, generate a majority of the industry's revenue. These two firms have increased market share concentration and dominance over the industry through significant capital investment projects. According to IBISWorld industry analyst Spencer Little, “domestic casinos face intense competition from international and online casinos, particularly for premium and VIP gamblers.” These patrons are targeted by domestic casinos as they place high-stakes wagers that can generate large amounts of revenue.
Continuing increases in per capita gambling expenditure, tourism levels and household discretionary income levels will all assist revenue growth over the next five years. In addition, “construction of three new casinos has recently been proposed and preliminary approval has been granted to these three firms,” says Little. Two casinos in Queensland, one in Cairns and one on the Gold Coast are anticipated to be operational by 2018-19. Crown has projected that its new high stakes VIP casino in Barangaroo near Sydney will be completed by November 2019. These new luxury casinos and hotels are expected to contribute to the industry's revenue growth over the next five years. However, competition from offshore and online casinos is expected to limit financial performance over this period. Casinos in Macau, Singapore and potentially Japan could capture demand from premium and VIP gamblers that may have otherwise travelled to Australia.
The Casinos industry has a high market share concentration. The major players are Crown Limited, Echo Entertainment Group Limited and SKYCITY Entertainment Group Limited. The top four firms operate 10 of the industry's 13 casinos. Crown has increased its market share concentration over the past five years through significant development and refurbishments of its existing casinos, hotels and entertainment facilities. As a result, market share concentration for the entire industry has also increased over the past five years.
For more information, visit IBISWorld’s Casinos report in Australia industry page.
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IBISWorld Industry Report Key Topics
Companies in the industry primarily operate facilities with a range of gambling services, such as table wagering games and electronic gaming machines. Firms also generate revenue from associated entertainment, hospitality and accommodation facilities.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.