Konami’s Bold Leap

We, as manufacturers, have to take risks to attract new players.”  — Steve Sutherland, COO, Konami Gaming Inc.

Harrah’s Resort in Atlantic City will be celebrating the Fourth of July weekend in a big way. A really big way.

In addition to Boardwalk fireworks and lots of red, white and blue, Harrah’s will use the occasion to launch the first of a new type of multi-station slot attraction featuring an arcade-type bonus that towers nearly 12 feet tall.

Created by Konami Gaming Inc., with help from the Konami parent company’s digital and amusement divisions, the Titan 360TM is unlike anything ever seen before on a slot floor, the company said. Part slot product, part arcade-type amusement, Titan 360 is a limited release that will be closely watched by the company and casino operators to see how players react and accept such amusement elements on the casino floor.

Titan 360 comes in six- and eight-station formats and fills the space of about 18 to 20 slot machines. Its crowning glory sits above the base games—a massive, mechanical bonus element employing a physical ball that swoops back and forth powered by gravity before it drops into a pocket, revealing the bonus award. High-definition screens, programmable sound packages and dynamic, multicolored lighting ensure casino patrons can’t miss the attraction.

Harrah’s Resort is excited to have the inaugural launch at the Atlantic City property, said John Smith, senior vice president and general manager of Harrah’s Resort, a Caesars Entertainment property.

“Harrah’s Resort has the most diverse and engaging slot floor in Atlantic City, and this launch only proves that we will continue to be on the cutting edge of slot technology,” Smith said. “In an entertainment market as competitive as ours, it is crucial to always be on the cusp of the next big thing, and this slot machine is definitely a game-changer. The interactive bonus round is a spectacle, one that is sure to gather a crowd on the gaming floor and without a doubt, the most fun you can have at a slot machine, anywhere on the East Coast.”

Smith noted that slot customers are incredibly savvy about gaming products.

“No longer is the expectation three spinning reels and one slot handle —a full-circle entertainment experience is now the expectation,” he said. “The design and size of the Titan 360 takes slot machines light years ahead of where they are now, with added elements of amusement built into the most exciting bonus round in slots, this is a game that will wow every customer within earshot.”

Konami is equally excited that the product will launch at a Caesars Entertainment property in Atlantic City. Caesars Entertainment is one of Konami’s best customers and well known for its marketing prowess. “They’re really going to get behind Titan 360 and make sure it gets the reception that it deserves in that market,” said Ross O’Hanley, vice president of North American sales for Konami.

Titan 360 showcases Konami’s ability to create entertainment that no other manufacturer can, said Matt Reback, Konami’s senior director of marketing.

“The sweet spot that Konami has, and what we pride ourselves on, is the ability to create experiences,” Reback said. “In fact, that mandate comes from our chairman, Mr. Kozuki. His mission for us is to take people’s free time and turn it into valuable time through entertaining experiences, including video games, pachinko, slot machines and fitness equipment and facilities. And the Titan 360 really is an embodiment of that mission.”

Investing for the Future
Titan 360’s creation signals that Konami is delving deeper into how best to incorporate more of the elements from its parent company’s roots in the amusement arena.

“Konami has a very steeped history in the amusement world,” said Steve Sutherland, Konami Gaming chief operating officer. “This product is an opportunity to draw upon collaborative efforts with our amusement division and bring some of those products to the marketplace. We’re hoping to get some findings from this product to determine acceptance for some of these amusement-type devices into the market.”

Konami has seen some indications that players are attracted to products employing mechanical elements, Sutherland said.

For instance, Konami brought its Advantage RevolutionTM, which is a unique slot cabinet that features two high-definition video screens combined with traditional mechanical reels that rotate back and forth and a rotating reel box with three different play areas to keep players engaged and entertained, to the gaming market three years ago, he said. “That’s been wildly successful, and in that innovative offering we just pulled one component from a mechanical device in an amusement device, and we turned it into a feature in a gaming device.”

Titan 360 is taking the amusement element to a whole new level in gaming, he said.

Konami is known in the amusement world in Japan for building very large multi-station feature centers within large amusement arcades, Sutherland said.

“That’s the focus—to bring a featured component to the casino to attract patron play. What will be the acceptance of that? How does this product play as a gambling-type device? Based on the feedback that we get from the game, we can start directing other game development and determine whether there is a market for these large multi-game units out there or are there other concepts that the patron likes that we can pull and put in a stand-alone device or a smaller multi-station-type environment.”

Sutherland said the company has many other successful elements it can draw upon from the Japanese amusement marketplace for use in gaming devices. “It could be a top-box activity or a feature center within a game in and of itself or a smaller game.”

Rigorous Review
Developing Titan 360 was no small feat, Sutherland said. Getting to this point has taken the better part of two years, he said, noting it required much work to incorporate the amusement element of Titan 360 into a feature that could pass muster with regulators.

“We had our R&D people working with our technical compliance department, and then we’ve had our technical compliance people going in and meeting with the regulators to make sure they understand the nuances,” Sutherland said. “There are some very difficult things on this. I mean, there’s a wheel with a physical ball so there’s a lot of things we were going through. The slot devices around it and the regular game play, that’s fine, but that feature set in that center piece is a whole other ballgame with the regulators.“

That hard work appears to be paying off, as the product is expected to earn its first jurisdictional approval from New Jersey regulators.

Konami’s Chief Compliance Officer Tom Jingoli said the product was submitted to New Jersey regulators under the New Jersey First provision, an expedited approval process for games that will debut exclusively in New Jersey for a certain period of time. Regulatory officials have been working closely with Konami to test the product, he said.

“We’re as confident as we can be that we’re going to reach approval by the expected date,” Jingoli said. “It’s a unique product. As you can see by size of it, the mechanical element becomes a little more challenging from a regulatory standpoint, but from a base game standpoint, it’s really no different than any other machine that we have.”

With the mechanical wheel, regulators want to ensure it is properly balanced and the pockets that the ball eventually settles into are all the same diameter “much like a roulette wheel,” he said. They also want to guard against any possibility of cheating, for example, that players could tamper with the ball’s movement, Jingoli added.

Only five of the Titan 360s will be released in North America, and Konami will likely target Nevada and some GLI markets for the remaining four.

Those, too, will have to get approval in each market, Jingoli said. “You like to think once you get a big market like New Jersey and you get approval, then the rest of the process will go relatively smoothly, but we don’t take any of that for granted. Each market has its own requirements for suitability.”

Risky Business
Creating such a game-changing product was an expensive undertaking, and, as with any gaming product, there’s no guarantee of success in terms of financial return on investment. But while Konami has high hopes for financial success, Sutherland noted that the company will gather valuable data about player reaction and acceptance.

“No risk, no gain,” he said. “We understand there’s a very significant investment in this, but the data that we’ll collect on this is well worth the investment for the future. And there are other things pipeline-wise that we’re looking at, so the data from this will determine the direction we take on these other products.”

There are important questions facing the industry that deserve to be explored, Sutherland indicated.

“We’re testing the market. We’re investing in the future. We’re really trying to determine where the market is going,” he said. “We, as manufacturers, have to take risks to attract new players.”

As Internet gaming and social gaming become increasingly popular, casinos are seeking ways to keep people coming to their brick-and-mortar facilities, he said. “The nice thing about this type of product is you can’t do that online,” Sutherland said.

Smartphones and tablets, he said, can’t fully replace the experience of gambling on the casino slot floor. “This is an experience. What we’re trying to drive is an experience on the casino floor and what we’re trying to find out is whether this type of experience drives play on the casino floor. We don’t know that at this point in time. We know that it worked in a certain market in Asia. We know that it worked successfully. We know that they have other devices, multiple devices, and that Asia is one of the largest social media markets in the world.”

Challenging Assumptions
Konami showed an early version of Titan 360 to a select few casino operators during last fall’s Global Gaming Expo (G2E). The reaction was “Wow, and everybody wanted it,” he said.

“A fair question arises when you take a look at the size of that device. We have eight seats on that product, and that product probably displaces 18 to 20 machines on the floor,” Sutherland said. “And the typical paradigm in the operator community is that performance is based on net win per unit, so what’s the proper metric for this device? Is it net win for the 20 units that this unit is replacing? Do those eight seats have to earn that, or is it going to be more about the metric for a dynamic that it’s an attraction device that I have on my floor to draw players in, and those players are going to play other games once they’re done playing on that device?”

Sutherland said he believes some casino operators are looking for that engaging attraction center for their floors and may be open to a different way of judging gaming results. “If we take a look today at the remaking of Las Vegas, the major source of revenue is still gaming, but look at the other revenue sources they’ve brought in, from restaurants, nightclubs, spas, entertainment and more,” he said. “They’re bringing in these other features to attract patrons. Are they bringing those in just to attract patrons to the restaurants or the hotels or the nightclubs? I don’t think so. I think they’re doing that to attract them to the overall experience, so is this just the next step—to bring other featured products to the floor—to make it more entertaining to the players.”

Titan 360 is something others can’t replicate, Reback said. “That’s why we’re real optimistic about testing the waters here with this, because we’re creating a product that can’t be replicated. It’s more of an experience than a product, but it’s based on solid math and proven performers with this high-entertainment-value center that’s got physics and mechanics in it.”

Reback said he believes players are willing to seek out such revolutionary products and give them a try. “I think people come to the casino looking for new experiences and looking for layered entertainment,” he said.

If Titan 360 takes off, Konami is prepared to ramp up to make more, Sutherland said. “If it warrants that based on the data we receive from our initial launch, absolutely we have the ability to turn that on,” he said.

Konami is hard at work exploring use of other amusement aspects, Sutherland said, while declining to reveal specific details about them.

“I will share with you that there have been teams of people at Konami who have been through Japan working with KGI-J, which is Konami Gaming Inc. Japan, and who work very closely with the amusement group,” he said. “And there has been a very thorough review of the products and feature sets that we would love to bring to market in multiple formats, multi-station, standalone, etc.”

Konami likely will showcase some of those elements at G2E in September, he said.

How the Titan 360 Plays
Steve Walther, director of games product management for Konami Gaming Inc., explained how the Titan 360 works.

The base games that players will sit down and play on the attraction are some of Konami’s most popular titles, including Jumpin Jalapenos, China Shores and Heavenly World, Walther said.

“The idea is to have a bit of familiarity in the base game so people can play their favorite games while also having this unique mechanical bonus experience,” he said. “For an additional 20 credits per bet level, they’re participating in the opportunity to take a spin on the Titan 360.”

Walther noted that players will be spending a bit more while playing a favorite game on the Titan 360 than on the same game unattached to the Titan 360. “But that money is coming back to them through the bonus events that are happening in the center area,” he said. “It’s not taking away from the experience that they’re having on the base game; we’re adding value with this amazing package, this engaging experience and the opportunity to win large amounts depending on the desired bet level.”

It’s important that players don’t have to give up something on the base games they love in order to play for the bonus, he said. “They’re still going to get their massive amounts of free games. They’re still going to get those mechanics that make those products popular, only now that they’ve been matched to the Titan 360 they’re going to get this opportunity to play this really exciting  bonus event where everybody’s spinning.”

The bonus is triggered through a simple game mechanic — finding key and lock symbols on the first and fifth reels of the base game. “It’s a lot of fun too. If you get the key on reel one and the lock on reel five, you’ve opened up the opportunity to experience the Rise to Wealth bonus game, which is the [mechanical element bonus] game that’s built into the Titan 360,” Walther said.

Frequently, patrons who play other bonus-style events at the lower level don’t have the chance to win big bonus awards, he said. With Titan 360, “we’ve scaled the rewards based on the bet level on the base game, so if you’re playing level one, you’ll win a lower amount as you play the Titan 360 Rise to Wealth game, but as you get to the higher bet levels, you’ve got the opportunity to win some serious cash awards because you’ve bet up the button panel. The game rewards you for betting up.”

When the bonus game is triggered, a physical ball launches from one side and swoops back and forth seeking a pocket to land in. “If the hole happens to have a dollar amount, players win that dollar amount prize. If the ball lands in one of the diamond symbol holes, they win the mini jackpot award or the opportunity to play on a new big money ring where prizes are multiplied by 10 and the jackpots are bigger.

“One of the things that makes the game so exciting is how frequently the center bonus will be going off,” Walther said. “We’ve got it on about one out of every 200 to 250 spins for the entire unit so if you have eight games around there, you’re roughly dealing with about every 30 spins, something is going off on the center unit. So it’s always going off, always engaging and always exciting.”