Las Vegas Sands Pulls Comps

Sheldon Adelson, chairman and CEO of Las Vegas Sands Corp. has gone back and forth over the years in a love/hate relationship with his own casino guests and complimentary incentives. Las Vegas Sands owns and operates the Las Vegas casinos Venetian and Palazzo. When the Venetian was first built, the beautiful resort focused more on conventioneers and less on gamblers. Since that time the property has swung further towards higher-end players, but that changed this past week.

Said Adelson, "No more comped rooms. No food and beverage. No showroom credits. We're selling rooms." All right, back and forth we go.As this plays out, guests are unhappy, gamblers are going elsewhere, but Las Vegas Sands is hardly upset. They get 80 percent of their revenue from their resorts in Singapore and Macau, and are pushing a new plan for a "Euro-Vegas" resort in Spain. The plan calls for a massive Vegas-style casino in Barcelona or Madrid with a price tag of over $20 billion.

At the same time, Las Vegas Sands said it received a subpoena from the Securities and Exchange Commission requesting that the company produce documents relating to its compliance with the anti-bribery act, and stated "The company has also been advised by the Department of Justice that it is conducting a similar investigation."

The Sands said the US probe originated with a wrongful termination lawsuit filed in October by Steven Jacobs, one time chief executive of its Macau unit.

No one said it was easy running casinos, but pulling back on comps for your guests seems extreme when Vegas revenues have plummeted over the past few years. Only time will tell whether Adelson's move to turn his back on his loyal players and change horses in the middle of the stream is wise or not. Although the casinos will no longer woo their guests with the "special" comps they have been offering, the casinos will continue to offer "standard" comps for returning guests based solely on their current play.