Tuesday, December 8, 2009

Murren and Ralston: It's Even Worse

Jon Ralston undersold himself -- or teased us to watch, if you believe him to be that diabolical -- regarding his exchange with MGM Mirage CEO Jim Murren about Murren's remark to me that he's never been in Encore or Palazzo and doesn't even know when Encore had opened.

Here's the whole exchange, which begins when Ralston asks him about the remark and quotes from my L.A. Weekly story:

Murren: Honestly, I wouldn’t have gone to the spa tower if I didn’t work at MGM Mirage and Bellagio opened up the spa tower. There would be no reason for it. I wouldn’t need to. I live in Summerlin. I have a great community. I coach my kids. I have a lot of restaurants out there. If I didn't work in the resort community, I probably wouldn't come down here much. That was my point. That is my point as a counterpoint to CityCenter. I really believe it is not a casino-hotel. I really would not be upset at all if people never visit Aria that live here, but I would be upset if they didn’t try to wander around CityCenter and enjoy the environment. I think that’s something that would be enhancing to them.

Ralston: You don’t think as the CEO of the biggest employer in the valley, you should check out the competition once in a while?

Murren: I do, but you know we have great people. You called me the Father of CityCenter. You know, Jon, that we have 50,000 people working for us right now. I have the most talented men and women in management that know more about than I will ever know about casino operations, hotel operations, casino marketing, hotel marketing, I don’t need to go to every property to get an idea what’s happening.

Click on the image below to watch this segment.

You can watch all four segments of Jon's talk with Murren here. Well worthwhile.

So here's the problem. Murren admits he has no need to go to any of these places, it's not his thing, he wouldn't even have gone to his own property if it weren't his job. This is NOT a man who has a great passion for the offerings that Vegas-goers enjoy. He does not identify with most of you who read this blog.

And yet Jim Murren has just decided that he understands what travelers who come here want -- to the tune of a $8.5 billion complex. There's a disconnect there and it's a very, very important one.

Murren speaks of "themed resorts" as if (a) they're tawdry and (b) anyone's opened a new one since 1999. All that has been built -- I'm leaving out Aladdin/Planet Hollywood because that's a strange anomaly in so many ways -- in recent years have been upscale quarters for the increasingly wealthy, hip and cultured. What's new this decade? The Palms, Wynn, Encore, Palazzo, Palms Place, Red Rock Resort and M. Not a theme to be found in any of those. And Murren would know this if he'd do his due diligence as head of this corporation. (Palazzo, despite its name, really is themeless.)

No, the argument could be made that in a marketplace increasingly crowded with stuff for a class of people whose numbers are shrinking, a new themed resort geared to the rest of us would be a delightful, welcome and distinctive change of pace.

What's more, Murren is eschewing the sort of serious in-the-trenches research that Wynn, Maloof, the Fertittas, the Boyds, the Marnells and others are known to do in a constant fashion. You just can't understand Vegas secondhand or from a report. Just ask anyone who was dragged here kicking and screaming by a spouse or friend and then had all their preconceived notions erased.

CityCenter was Jim Murren's idea. A community is now reliant on its success. But when Murren tells us he thinks he knows what travelers want in Las Vegas, he's basing it on what?


atdnext said...

I know, I know. I was thinking the same thing earlier today. Murren obviously isn't listening to the people he should be. Honestly I LOVE City Center's design, but how many more people are art nerds like me? How many people want to just go for high-end shopping or fine dining? I may, but how many more are out there that just want to know where the casino is?

Now I'm starting to worry. I thought Jim Murren knew what he was doing with City Center. Now I'm wondering just how well he actually knows Las Vegas.

detroit1051 said...

Steve, thanks for the link to Ralston's interview with Murren. Murren may be very financially astute, but he didn't display the inquistiveness a CEO should have about his industry and the competition. I wonder what Kirk Kerkorian thinks about Murren's smugness about not having been in Encore or Palazzo. Then, when Murren said he wouldn't have visited Bellagio's Spa Tower when it opened had he not worked for MGM, I just shook my head. Alan Feldman must be cringing at these comments.
Finally, when Murren was asked about his support of Rory Reid, he said, "I don't follow politics too closely." What's with this guy? I would think major investors would not be happy with Murren's cavalier attitude.

Michael (@jinxclev) said...

I have to agree with the perception that overall Murren's vision of what CC should be, isn't going to bring in this new base, that ultimately wasn't interested in Vegas anyway. At least interested prior to say Wynn, Encore or even Bellagio.

At it's worse though, it's another spin on 'ultra' Vegas, it's easy to claim this is something 'new' if you haven't been in your competitors resorts. In the end isn't all Murren saying, really just what Steve Wynn has been doing with his 2nd generation of resorts?

Anonymous said...

Mullen: "If I didn't work in the resort community, I probably wouldn't come down here much."

Forget about City Center for the moment and concentrate on the fact that Mullen is the current CEO of MGM/Mirage!
What does that say about how he feels about the other dozen Strip properties he also manages?

Is it just TOO HARD for him to show a bit of enthusiasm or at least fake it when representing a huge chunk of Las Vegas casinos?????

Kind of reminds me when overpriced celebrities get caught saying they don't actually use the products they get paid to endorse!

This guy is so out of touch with reality it is genuinely frightening!

Never in my entire life have I seen the CEO of a major corporation look so unqualified and misinformed every time he opens his mouth!

Somebody outta brief this guy for press conferences, give him a prepared script, etc!

- Laura

Anonymous said...

Not being a big fan of Steve Wynn, I give him credit for personally paying a visit to Crystals last week to check out what he perceives (correctly so) to be his competition. Wynn had to see it with his own two eyes in order to make an evaluation. Unlike Mullen, Wynn didn't rely entirely on reports from his paid assistants to keep him informed.

Mullen actually admitted in this same interview that he doesn't feel that Wynn, Encore or Palazzo are in competition!

- Laura again

Anonymous said...

So, thinking of building hotels in Las Vegas without gaming, eh?

Last month I was researching the history of the legendary London Playboy Club with Victor Lownes and found some interesting conclusions:

"1973 saw the addition of the Manchester and Portsmouth Casino Clubs. With the gaming license approval for the Victoria Sporting Club in February 1981, Playboy Enterprises became the largest, and, table for table, one of the most profitable gaming operators in the UK. They had three London casinos, two provincial casinos, interests in two others, 72 off track betting parlors, and six bingo parlors. In these casinos they attracted some of the highest of the high rollers and societies’ upper crust."

Then its demise:

"By 1981, Lownes was senior VP in charge of the casinos worldwide, the moneymaking part of the whole Playboy empire. He was leading the effort to open up Atlantic City, New Jersey, U.S.A. for gambling from his London base. Work was started on the future Atlantic City Casino building.

However the British had always been uneasy with a foreign controlled casino operating in London. Lownes was (falsely) accused of irregularities by the British gaming authorities. Hefner panicked and before Lownes even appeared before the authorities he was fired in an obvious attempt to save the New Jersey deal. Lownes might have been able to sort out all the problems had he been given the chance. Without him, the British gaming licence was revoked and Playboy lost their most valuable assets. Playboy's temporary gaming licence in Atlantic City was not renewed.

Playboy, which made $31 million in the year ending June 30, 1981 lost more than $51 million in the year ending June 30, 1982. Playboy barely survived."

So how important is gaming when it comes to clubs/hotels?
- Still Laura again

AccessVegas.com said...

Was I the only one who noticed that Treasure Island was in the backdrop over Murren's shoulder during the entire interview?

Have no clue if it was on purpose, but certainly an interesting note. I'm sure he'd rather have Veer in the background.


Access/Ted: That's a coincidence. The TV stations around here haven't got the money to redo the backdrops. KVBC's still, if you look carefully, has the S&R marquee.

John said...

I think this whole 'thing' is and has been overblown.

ScottChompson said...

He said it himself, he has other managers that are far more experienced in hotel / casino operations. As the CEO he is the face of the corporation. He should be educated on every detail of what is happening around him so that he can effectively lead that team of managers. This means he should be walking his crack a mile up the road to check out what Mr. Wynn and Mr. Adelson has going on. Hell, if I were the CEO, I would drop by Casino Royale just for the sake of being neighborly. There are 365 days in the year. It would take 4 hours to visit Wynn.

If he is not doing that, what in the hell is he doing?