Virgin to enter Casino market?
Richard Branson is in talks with leading British and American casino operators discussing deals aimed at putting the Virgin brand name over one or more of the new giant casinos to be permitted when the Gaming Bill becomes law.
"It is an area we are closely looking at," Will Whitehorn, Mr Branson's main spokesman, said. "We have had a number of approaches, from both sides of the Atlantic, about using our name in casinos."
The Bill, which is currently going through Parliament, will legalise large-scale gambling establishments on the scale which has applied in Las Vegas and Australia for some years.
The latest thinking is that there will be nine or 10 such casinos throughout Britain, on a regional basis. They will each house 1,250 slot machines as well as tables offering poker, blackjack and roulette.
Las Vegas operators such as Caesar's Palace have joined their British counterparts in expressing an interest in running these outlets. However, there has been considerable opposition from pressure groups keen to resist the original proposals for a free-for-all.
"We have not decided to do anything yet," Mr Whitehorn said. "It's early days and we will definitely wait until the outcome of the Bill." Nevertheless, Mr Branson has been running an online gaming business for the past 10 weeks, and his company has joined the British Casino Association. These are seen by industry insiders as telling signs that Mr Branson is preparing to enter the sector in a significant way.
The Virgin name is highly attractive to operators who want to appeal both to experienced gamblers and to novices, as Virgin is already well-known and trusted through its mobile phones, records, financial services and airlines.
Virgin Atlantic, the long-haul airline, has been running direct flights between the UK and Las Vegas for more than four years, giving the group exposure to the gambling fraternity.
Mr Branson's business development executives are understood to have taken advantage of the opportunity to study casinos at first hand.
Such studies indicate there is considerable expertise involved in running casinos successfully. And, as Mr Branson has already shown a liking for joint ventures - Virgin Atlantic is 49 percent owned by Singapore Airlines - he would find no difficulty in marrying the Virgin name to casinos run by established operators. His participation would equally help to smooth the path for a foreign entrant into the new market.
There are three main business models which might be employed. Either, as with Virgin Atlantic, a joint-venture company could be set up; or a casino operator could charge a management fee for running a Virgin casino; or Virgin could take a royalty for lending its name to a casino run by an approved operator.