Why has Atlantic City, on top of the world for many years as one of the world’s casino capitals, fallen on hard times? Frank Fahrenkopf, former CEO and president of the American Gaming Association from 1995-2013, has some theories.
So far, four of Atlantic City’s 12 casinos have closed this year and have fallen nearly 50 percent in the last eight years.
In an interview with the Harvard Gazette, Fahrenkopf declared, “I can only think of two places in the United States where competition has really driven people out of business. The first is Atlantic City. When I was with the AGA, for 15 straight years I would always go down to speak at the gambling conference there, and I constantly told them, You’re going to have to clean this place up.’ I don’t know when the last time you were in Atlantic City was, but it wasn’t very nice. And they didn’t do it for a long, long time. Unfortunately for them, they were unlucky because just about the time that they started to turn things around, we had the economic crash in 2008, and so that really put them back.”
The other such town is Reno, also once a strong gaming town, which is now trying to reinvent itself as something else. Its market share is the victim of all of the casinos built in California by gaming tries, he said.
The factors that have caused Atlantic City’s decline are unlikely to affect the casinos anticipated by Massachusetts, he said. “Massachusetts has a higher percentage of people who gamble than any other state in the union. Most of it has been with the lottery over the years—it’s the richest lottery, I think, in the world—and they drive down to Mohegan Sun, or they drive down to Foxwoods, or they drive down to Rhode Island. So you have a population here that likes to gamble,” he said. If the Bay State’s voters decide to prevent the state from building three casinos and a slots parlor, those players will continue to go to neighboring states such as Connecticut and Rhode Island.
