Las Vegas Sands Backs out of Online Gambling Space
One of Asia’s biggest casino brands has decided to cease operations in its online casino business unit this week – a sharp U-turn on the previously launched enterprise. The quite departure from the lucrative industry is not what many in the business had expected to see from Las Vegas Sands. There is immense opportunity to be gained from hanging around in the online space, but for Las Vegas Sands, these opportunities have been few and far between – they are now opting for closer alignment to the core business.
The casino operator has ceased its ascent into the online gaming space in favour of a re-alignment and focus of its operation in Macau. ©fielperson/Pixabay
Following an investigation by independent research firm Eilers & Krejcik Gaming (EKG), it has been highlighted that Sands’ online gaming division had been dissolved. The digital gaming unit at Las Vegas Sands had been conceptualized and created back in July 2021 and had been designed to pave the path forward for the casino group into online casino. That strategic decision seems to have been ill-timed though, and the firm have now had to initiate a reversal on the original strategy in favour of solidifying the base casino business.
Digital gaming still represents an enormous ocean of possibility for the casino company, and they are likely to continue their offerings in the online gambling space. The opportunity is undeniable, but for Las Vegas Sands there remains an overhang of technical start-up costs, and lack of user engagement to make this trade-off worthwhile in the current climate.
Las Vegas Sands holds a portfolio of investments in the online casino space, and since the group became an investment arm for so many different gambling companies around the world, they have had to re-tune their approach to investing. With the outgoing staff from the online and digital gambling team at Las Vegas Sands were two of its leaders – who have since decided to set up a rival digital gaming investment group upon their departure. There is still the feeling that Sands will begin to offload its investments in the space to a third-party.
Fallout from Las Vegas Sands Quick Departure from Online Gambling
The previous optimism for Las Vegas Sands’ presence in the online gambling space is quickly eroding – as they depart the business of online gambling just as quickly. The speed of this pivot has certainly caught many bystanders by surprise, and there wasn’t a consensus around the efficacy of this move. The past few years have been tough for the group, but there were a profile of investors and partners that believed the group could have ventured further into the online gambling space, and potentially scale into sports wagering.
Sheldon Adelson, the late founder and CEO of Las Vegas Sands, had previously resisted the expansion of the casino into online wagering. His objections to that move were partly morally related to his commitment to maintain Las Vegas Sands as a responsible player in the industry. However, his opinion of sports wagering as a potential expansion strategy were much better received – and this path seemed like the logical choice for a long while.
Indeed, the biggest casino operator in the USA according to the aggregate value of its shares has not written off the possibility of returning to the online gambling sector. The firm has made a series of strategic investments over the past few years into several online gaming startups, including Huddle Tech and Fortris. Whilst pulling its online gambling division offline, the firm has yet to announce the liquidation of these investments – indicating that a return to online gambling could very well be on the cards.
Sands’ sudden departure from the online gambling space has caught many industry watchers by surprise. The move was not announced and has even caused collateral damage to startups that had been courting investment from the casino operator. One had been expecting Sands to lead the entire round, only for the term sheets to be completely pulled. The company is thought to be stepping away from online gambling in pursuit of a broader ambition to become the biggest player in Macau.
