The top executive at one of the world’s largest gaming companies isn’t one for going all in at the poker table.
MGM Resorts International boss Jim Murren doesn’t gamble in the casino anymore.
Instead, he's known to gamble in the board room, where the former Wall Street analyst has guided MGM Resorts through the Great Recession.
The company recently reported first quarter revenues of $2.3 billion. MGM even paid its first dividend to CityCenter shareholders.
So what’s next for Murren and MGM Resorts? And, what about the reports of a possible merger with Wynn Resorts?
“It’s a rumor,” the CEO told KNPR’s State of Nevada.
Murren said he knows CNBC host Jim Cramer, who first mentioned the idea on his show “Mad Money,” describing him as “talented but a little nutty.” Murren said he respects Wynn Resorts but called the idea “total speculation.”
What isn’t speculation is Murren’s belief in the benefits of legalized and regulated online gaming.
“It allows companies like ours to responsibly operate, rather than these knuckleheads that are off shore that don’t have your best interest at heart,” Murren said.
Although, he doesn’t believe a ban would hurt MGM Resorts because of its business model, he doesn’t want the business pushed into an unregulated zone.
“What happens today is non-licensed, non-regulated companies are engaged in this activity instead of companies that have so much at risk like ours,” Murren said.
The head of the gaming giant has the same attitude towards sports betting.
“Any way we can break down a barrier on a gaming experience and create a legalized, regulated environment it’s good for MGM,” Murren said.
He also criticized what he called “hypocritical point of view” of major league sports leagues when it comes to sports betting versus fantasy sports.
“They’re trying to tell folks that this is not gambling. Well, I’m in the gambling business and it is gambling,” Murren said.
He believes the best way to handle sports betting is to end Nevada’s monopoly on it and regulate it.
The Great Recession nearly toppled MGM Resorts. With the help of Sen. Harry Reid, CityCenter and the company was brought back from the brink.
Murren admitted the impact of the recession is still being felt.
“The scars, for me and for many of us, have not healed. It was a harrowing time for Las Vegas, for our company, for many of our senior executives and most importantly for all of our line employees,” Murren explained.
Despite the ‘scars,’ the CEO is optimistic about the future of the city and his company.
“I would say it’s going to be consistently improving throughout this year and into the next,” he said, “I’m quite positive about the economy.”
He credited much of the company’s success in focusing on non-gaming revenue streams, including restaurants and nightclubs.
“We believe that is the future of Las Vegas to continue to increase the demographic appeal for folks to come here that have no interest in gaming but want to spend a bunch of money with unique experiences,” Murren said.
He pointed to the recent Rock in Rio music festival and the epic Floyd Mayweather and Manny Pacquiao fight as examples of how entertainment events can drive business.
“A lot of employees up and down the Strip made an awful lot of money on the Maywether weekend, whether they worked for MGM or not, because the town was packed with really energized, fun people,” Murren said.
LEAVING NV ENERGY
One thing Murren was not positive about is the amount the company pays to NV Energy, which he put at $86 million a year.
MGM Resorts International is one of three gaming companies applying to create and purchase power without NV Energy.
“We’re not interested in subsidizing everybody who lives in our state on the backs of us overpaying for our power,” the CEO said.
He said it is not that they want to leave NV Energy, “we want to create a more balanced playing field than exists now.”
Wynn Resorts Ltd. and Las Vegas Sands Corp. have also applied to leave NV Energy. On Wednesday, the Public Utilities Commission denied an application for Switch to cut ties with the utility company.
The three member commission denied the application on a 2-1 vote. What the PUC's ruling means for MGM Resorts is not clear, Murren appeared on KNPR's State of Nevada before the commission's decision was released.
While the MGM boss wouldn’t speculate on a ‘gaming friendly’ candidate, he did have high praise for two Nevada politicians.
“I’m a huge governor Sandoval fan,” Murren said, “He’s had tremendous courage to put forward a plan that’s going to fund education and fund our future for really the first time in decades”
He also heaped praise on Sen. Harry Reid for his impact on the gaming industry and Nevada.
“I think our state underappreciates what Senator Reid does for us,” he said, “He has been a fierce and relentless supporter of Nevada.”
He hopes one day people will realize the impact the senator had on the state.
PLANS FOR THE FUTURE
Now that Las Vegas is finally back on its feet again, the gaming company’s top man is far from resting on past successes.
The gaming company is in the middle of building a new arena just off the Strip between New York New York and the Monte Carlo. From the Strip to the arena will be a park, which he calls the ‘epicenter’ of the Strip.
He also believes the arena will be home to a professional hockey team and was proud that MGM was involved in the effort.
“I’m betting that we will have a hockey team,” he said, “I think that you’re going to see hockey being played in that arena no later than the 2017 season.”
The arena is part of the vision he has for the future Las Vegas.
“You’re not going to have an opportunity to trap people in the resort for hours on end like the old business model,” he explained.
He said visitors want more indoor-outdoor experiences and more dynamic places.
“The good news is there is no market in the world that can compete against Las Vegas because of the invested capital that has already been deployed here. All we have to do is continue to stay ahead of that curve,” Murren explained.
Besides the physical changes to Strip properties, Murren envisions more skill-based gaming and more live interactive games to appeal to younger customers.
“We need to find the product and the service that the customer of the future want,” Murren said, “That’s the way to attract people to Las Vegas today and in the future is to create these spontaneous experimental ideas.”
Jim Murren, chief executive officer, MGM Resorts International
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