GAMING IN RUSSIA. A candid chat with Evgeny Kovtun
We met Evgeny Kovtun, editor of the new Russian magazine “World of Games” at the International Casino Exhibition (ICE 2005) in London last January, and were able to talk about his new publication and his experience of gaming in the industry’s most dynamic region of the world. At the time EK told us about the new Moscow gaming expo sponsored by the title and that bears its name, at the Crocus Expo venue over 9-11 June.
As the industry awakens to a Moscow summer show, we felt that EK would be the right person to give us an update on the event, as well as his impressions on the gaming industry in his country. Being an attorney by profession, we felt that the best way to start would be to talk about gaming legislation in Russia:
CC - In Las Vegas, Michael Bottcher, president of Storm Gaming said in a seminar that anyone could open a casino or slots parlour in Russia, with very little difficulty, as long as they paid the licence fees and operating licences. Would you comment on this?
EK - Indeed, up to 2005 any entrepreneur could open casinos or slots parlours in Russia. The licensing was running by informative order, i.e. the person presented the documents and if everything was OK he had the license in 2 months. Since this year everything is changed. The licensing is suspended for the time being and it is very probable that it will be re-launched with new requirements after the 1st of July 2005.
CC - Does this mean that a private individual can operate a casino or does it have to be a limited company?
EK - It can be a private individual or a company, as long as they comply with the corresponding Law. According to the Constitution of the Russian Federation, every person has the right to undertake his own business, but the requirements are the same for them as well as for the limited companies. From the point of view of taxation, the limited companies are more profitable in gambling than private persons.
CC - Do you know how many casinos and slots operations are installed in your country? Could you break this down to Moscow and the other states or provinces?
EK - There is no exact data for the time being, and this is related to the absence of a controlling organization, which has been closed recently. A new controlling body should be ready only in July. The estimates of our Russian Association "World of Games" has numbers for Russia, where there are a few more than 900 casinos and 11,000 slot parlors.
CC - Also in Las Vegas one of the speakers said that each year the numbers of slot machines for the Russian Federation were doubling up. If there were near 200 thousand slots in 2004, does it mean that there will be 500 thousand by 2006?
EK - Indeed, during the three last years the number of slot machines in Russia was doubling each year. But it is very probable that this year we'll not continue such a process. It is related to the toughening of the licensing and to the increasing of the taxation. It is certain that we'll not have 500,000 slot machines in our country.
CC - Who are the players in your country? What is the per capita GDP? How many inhabitants in Russia and what is the average number of people per family?
EK - The Russian population today is about 145 million. A family usually counts 3 or 4 members. Not so long ago the president Vladimir Putin announced a program targeting to double GDP. Russian suppliers of gaming equipment are making a valuable contribution, increasing constantly the production and extending the markets. The slot machines labeled "made in Russia" are popular in Russia and countries of East Europe and America.
GAMBLING CULTURE IN RUSSIA
CC - As far as we can surmise, the gambling culture in Russia is very strong. Of course we know about Fedor Dostoyevski’s classic The Gambler, but that was written in another era, when only the aristocracy could gamble in casinos. It seems that nowadays anyone can gamble in Russia or any other country. Is the gambling culture in Russia more, let’s say ‘democratic’?
EK - Actually in Russia there is no gambling culture. The culture that existed hundreds of years ago was lost with the 70 years of socialism. Gambling was prohibited during that time. But now the Association "World of Games" is popularizing the culture of gambling. Our objective is to do it in a way so that people take the gambling as amusement and a convenient way to spend free time, and not as the way to get easy money without making efforts.
CC - We have read from an interview written about you, titled “Risk without any danger”, that the so called gambling culture should be taught by specialized professionals for the benefit of those working in the industry. Do you mean gambling culture or gambling education?
EK - Our wish is that in the gambling business there should be only people with the understanding of the environment in which they are working. Nobody should employ a croupier who does not know the rules of the game. We want all the gambling employees to have some degree of education.
CC - Well, that’s gambling education, and a gambling culture is surely emerging, but meanwhile there is a neutral or negative attitude towards gambling in the majority of the population everywhere. How does this viewpoint relate to Russian society?
EK - It would be a mistake to think that our population’s attitude towards gambling is negative. Every Russian family has a pack of playing-cards, to say nothing about dominoes, backgammon and other games. People, not only in this country but all over the world, played them yesterday, are playing today and will keep playing tomorrow. Inclination to gaming is inherent in each of us. It is not only cards or dice, but a lifestyle, a part of our life. It is obvious that there are many differences between just gaming and gambling. Changing of a gambler’s welfare during the game can be regarded as one of them. In my opinion, it explains why gambling is loved by some people and hated by others.
Nowadays activities concerning organization of gambling in Russia are rapidly developing. It has already led to an increase in standards applied to gambling houses and casinos as well as to Russian and foreign equipment. Much of what we have in this country you will not be able to find in the best gambling houses in Europe. However, it does not presuppose the same rapid increase in the education level of those who work in this field and consume these services.
In Russia the gambling culture should be established among casinos personnel and owners, gamblers as well as among those who are in control of this business. Just because of a lack of this culture a spontaneous propaganda against gambling has been mounted in our society. According to it, gambling is undoubtedly harmful and can result in a new disease – ludomania.
People should be aware of the fact that gambling is just a kind of entertainment just as going to the cinema, a discotheque, a restaurant or bowling. We come to gambling houses and casinos not to earn money but to have fun. Unfortunately, a lot of enlightening work should be done to break down this misunderstanding.
RUSSIA’S SUMMER EXPO
CC - How did the expo idea originate? It’s great to have the magazine name as the expo title: “World of Games Expo and Congress”.
EK - The Exhibition as well as the magazine edition presents one of the activities of the Russian Association "World of Games". Our Association is publishing books, organizing seminars and congresses. We think that the exhibition and its congress are a development on last year’s event, when there was a congress in May in the President Hotel in Moscow. This time we would like to tell the gaming industry the achievements of our association up to now.
CC - Finally, what is the outlook for Russian gaming in its relationship with the rest of Europe?
EK - As for the slot machines, slot parlors and casinos, our country is ahead of many European countries. Our liberal legislation has contributed a lot to this, but after middle of 2005 the most important criteria for Russian gambling establishments will be not the quantity but the quality. And here we should and will be learning from Europe.”
As the gaming world makes a date to meet in Moscow during 9-11 June, the work of The Russian Association “World of Games” seems to be bearing fruit, and we look forward to the next issue of the magazine edited by this engaging gaming man from the most promising gaming market in the world.
http://www.casinocompendium.com/evgenykovtun.html