IGB analyst Marjorie Preston notes that South Korea's latest casino resort, Mohegan Gaming's Inspire, is poised to bolster the local gambling industry against upcoming competition from Japan. Industry experts emphasise the importance of effective marketing and increased advertising to strengthen the South Korean market.
Mohegan Sun in Uncasville, Connecticut, known for pioneering the integrated resort concept, remains a standout example. The vast venue, boasting two casinos, luxury hotels, shopping, dining options, and entertainment facilities, has set the benchmark since its establishment in 1996.
Mohegan Gaming's foray into Asia with the $1.4 billion Mohegan Inspire in Incheon, South Korea, signals a new era in the country's gambling landscape. The resort is seen as a blueprint for the future of gaming in South Korea and aligns with the government's aim to attract 20 million international tourists annually by enhancing tourism infrastructure. This vision, however, faces challenges as Japan gears up to open MGM Osaka in 2030, marking Japan's inaugural legal casino. With Incheon and Osaka in proximity, the two destinations will vie for the same international clientele, necessitating strategic moves from the South Korean casinos to stay competitive.
Inspire: raising the stakes
Prior to the introduction of Inspire, other Korean casinos had also applied for IR status. Paradise City, situated in Incheon and established in 2014, featured a hotel, theme park, and meeting facilities. Jeju Shinhwa World, located on Jeju Island and operational since 2018, consisted of a Marriott property with accommodations, a theme park, and a water park.
However, Inspire raised the stakes by offering three hotel towers, a large arena, a spacious ballroom, a unique water park, and an extensive outdoor amusement park. Osaka's forthcoming $8.5 billion megaresort, set on Yumeshima Island in Osaka Bay where the 2024 World Expo will be held, will provide significant competition for Inspire.
Known as IK, this resort will include luxury hotels, a vast amount of conference space, shopping areas, entertainment options, and a museum showcasing Japanese culture across 700 acres. As stated by MGM's President and CEO Bill Hornbuckle, IK will bring the extraordinary appeal and distinctive essence of MGM from Las Vegas to Osaka.
Korea is already 8 balls behind
In a recent Korea Times article, researcher Yang Hyun-eun from Osaka emphasised the need for Korea to launch its own gaming industry without further delay. He believes that the country has focused too much on regulation instead of promotion in developing its integrated resort (IR) industry. Yang called for a white paper to outline MGM Osaka's development strategy to compete with potential Japanese competition, as he fears Japan's expanding gambling market could pose a threat to Korea.
He stresses the importance of establishing a future vision and philosophy for the South Korean casino industry to drive innovation and growth. Meanwhile, the upcoming opening of Inspire in November 2023 is expected to significantly impact Mohegan's financial performance. Analysts predict that Inspire could achieve positive cash flow by early 2027, as it aims to elevate hospitality and entertainment standards near Incheon International Airport.
With Japan also entering the casino market, there is hope that Inspire will continue attracting guests to Korea even after Japanese IRs open for business.
