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Macau's Casinos Have Been Relying On VIPs, But The Mass Market Is Crucial To Future Growth by Muhammad Cohen

Everyone agrees Macau's future lies with the mass market, not VIPs. No one can agree on when that future will begin, though. Macau's recovery since August 2016 has been largely fueled by VIP play, and that trend accelerated in last year. Analysts diverge on whether the mass market future starts in 2018, and evidence so far remains decidedly mixed.

For casino operators, mass-market play is easy to love. It's more profitable, more stable and the customers pay for money-spinning non-gaming items, such as hotel rooms and meals, that VIPs expect for free. Mass play is far less complicated than the VIP segment that relies on high rollers from mainland China, largely sourced by junket promoters that take roughly half the profits in commissions. Junkets provide credit to customers to help them skirt China's currency restrictions. Travelers can legally cross the border with RMB 20,000 or the foreign currency equivalent of $5,000, barely enough for a handful of bets by the average high roller.

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