Manufacturer stepping up game, heightening push into Class III casinos

Multimedia’s new Sport of Kings community game

When gaming industry veteran Anthony Sanfilippo decided to join Austin, Texas-based Multimedia Games a year ago as its president and chief executive officer, he knew the challenges that awaited him.

But he also knew it was a chance to reimagine a company, strengthen it and expand beyond its core competency in Class II gaming.

“When I joined the company I really looked at it as a company with an existing revenue stream that really had the opportunity to become a new company and that’s what personally excited me about joining the company,” said Sanfilippo, a 25-year industry veteran who spent 10 of those years as president of Harrah’s Entertainment’s Central and Western Divisions.

And the company’s renaissance is well under way, Sanfilippo said.

He noted the company’s first priority after he joined a year ago “was to make certain we had the right talent in place to execute on our plan -- to focus on what our company has done well in the past, to identify the opportunities that lie ahead of us, and, most importantly, to ensure we focus on those opportunities that will produce profitable revenue for our company. To achieve these objectives, we materially changed the leadership within the organization and brought on very talented individuals.”

For example, he cited the hiring of Mick Roemer, a longtime executive with various gaming manufacturers including Bally Technologies, VLC and IGT, as senior vice president of sales; Ginny Shanks, a former Harrah’s Entertainment executive, as chief marketing officer, and another top Harrah’s executive Pat Ramsey as chief operating officer.

Roemer noted the company’s focus on adding the right people to augment the development team and on redirecting the culture of the company toward its new direction has been key.

He also cited the company’s rebranding as setting the stage for the company’s new direction. “Ginny Shanks has done a tremendous job,” he said.

Multimedia Games is a company that was built primarily upon technology, products and services that revolved around a central determinant system, in which gaming machines have their outcomes determined by a central server, Sanfilippo said.

That technology is primarily used in tribal casinos where customers play electronic bingo, and Multimedia also uses a central determinant system in New York, where the company manages a lottery system for the state of New York that reads lottery cards and then turns that into play on a video lottery terminal. In addition, the company also operates a similar system in Mexico.

Multimedia Games is now applying and evolving our technology and offerings into Class III gaming, he said. “And we are making a lot of progress in this effort,” Sanfilippo noted.

Sanfilippo noted the company is moving into the content business, developing good games for players, regardless of whether they’re playing a Class II or Class III game.

He also notes that the company operates some 17,000 revenue-sharing games in multiple casinos in the United States and Mexico. “From a strategy standpoint, our primary focus has been to make sure that everything we do is profitable,” he said.

Recently, Multimedia released its first community game, a horse-racing-themed game called Sport of Kings, which is now in three Oklahoma casinos operated by the Chickasaw Nation. “We’ve gotten really good feedback at all three locations, and we’ve got a schedule to continue to roll them out in Oklahoma as well as other jurisdictions” as the company receives the appropriate licensing and the game receives approval, Sanfilippo said.

Roemer agreed. “We’re seeing really high seat time. We’re seeing players coming back to the game and staying longer when they come back,” he said. “We’re seeing seeing a lot of crowd participation and rooting on of the horses and rooting for the customers sitting in the seats.”

Multimedia is refining its game development strategy as well, Sanfilippo noted.

“We want to focus on games that are widely accepted as opposed to games that might appeal to a small niche of players,” he said. “We think for games to be successful they have to have broad appeal.”

That means the company won’t be employing a shotgun approach to game development. “We’re much more focused on a quality game with broad appeal as opposed to a quantity of games that end up being games that are hit and miss.”

Asked whether the recession is opening or closing doors for manufacturers to have opportunities to get their products on slot floors, Sanfilippo said Multimedia is finding a footing. “We’re licensed today in a very few places, and we have found that people are very receptive to the games we’ve developed.”

The fact that many gaming operators are capital-constrained and aren’t changing out games as quickly as before works in Multimedia’s favor, he noted. “

“We’ve had the opportunity while people aren’t spending to improve our product and get licensed in jurisdictions we aren’t licensed in. When people start to spend, we’ll have a product that’s much more competitive than we’ve ever had before,” he said.

“We’re producing better games than this company has ever produced before. We are keenly focused on what the customer who sits in front of the game thinks and feels, and we try to anticipate experiences that they haven’t had yet but are in the realm of what is sort of their lifestyle and what makes them happy. Again, it’s simple, entertaining games that are easy to understand.”

Sanfilippo noted that Multimedia’s games stack up well against seasoned Class III manufacturers in Rhode Island. “We’ve already competed with in Rhode Island, and those are published numbers and our games perform better than house average and better than those manufacturers that are in Rhode Island in many cases, and we’re able to show our customers where we’re performing with a Class III game today and it’s doing pretty well.”

Multimedia has a lot of creative talent, and it shows in the product, Roemer noted. “I think we’ve got one of the most attractive boxes out there,” he said. “And I would put our graphics out there with the best of them.”

Roemer said the company won’t neglect some of its more popular games, such as the solid Class II performer, Meltdown. “We’re known for that. That’s still knocking the cover off the ball,” said Roemer, who noted Multimedia hopes to take that into other markets.

Multimedia also hopes to capitalize on opportunities the recession may be creating, including efforts to expand gaming into new jurisdictions, such as Ohio, Sanfilippo said. “When you see a recession such as we have had, people look for ways to be able to infuse tax dollars into their economy and Ohio is a great example of them doing just that, which creates an opportunity for manufacturers like us,” he said. “And I would add that with Ohio, no one has an advantage in that state,” and so if slot gaming is approved, Multimedia will have the ability to start on a relatively even playing field with other manufacturers.”

Multimedia is in the process of getting licensed with tribes in California, and also has applied in other jurisdictions such as Louisiana, Mississippi, Wisconsin and Minnesota, and is exploring Florida.

And he noted that Multimedia actually operates some 17,000 games on a revenue-share basis. “It’s a larger base of slots than a midlevel gaming company,” he noted.

Multimedia’s Casino Commander product allows casinos to switch a bank of machines from revenue to nonrevenue mode, in order to facilitate tournament play.

Another product the company has implemented is its Casino Commander, a system-based product that allows a casino to turn a bank of Multimedia games from revenue to nonrevenue games with ease. That’s something operators will appreciate because it facilitates offering tournaments. They don’t have to set up special tournament games, but can simply use regular games in the nonrevenue mode.

The Casino Commander technology also gives the company a foundation for server-based gaming, but Sanfilippo said that’s not something high on the company’s radar screen. “Our first order of business is produce games customers want to play. We’re paying attention to server-based, and we think we already have the foundation with our Casino Commander but we think that, especially with this current recession, it is a number of years away, so our focus today and in the immediate future is on producing content that will be terrific games for customers to play.”

Roemer noted that being part of the company’s turnaround has been exciting. “People are really responding to the product. Everything seems to be kind of moving in the right direction.”

The bottom line is the company’s games will have to perform, Roemer said.

“It really does all come down to content,” he said. “As long as the games earn on the floor, operators are receptive to keeping them.”