Sheldon Adelson’s casino company, Las Vegas Sands Corp., had its quarterly earnings call on January 27. One day earlier, Robert Goldstein became the new Chairman and CEO. The earnings call went through balance sheet items and tentative expansion plans. But ears perked up when he mentioned online gambling. Las Vegas Sands is looking at opportunities and seeing whether it’s worth the investment for them.
That’s a big turnaround. Sheldon Adelson was a fierce online gambling opponent. It wasn’t just because his company was built on retail casinos. (Although, limiting online competition likely was a savvy business move, anyway.) Adelson had strong moral objections to online gambling. In 2013, he wrote an op-ed in Forbes decrying online gambling and calling on Congress to rewrite the Wire Act to prohibit it.
Sands CEO Robert Goldstein also cited Adelson’s moral objections to online gambling in the earnings call. Adelson believed that online gambling technology couldn’t prevent underage children or problem gamblers from gambling. He believed this until his death at the beginning of 2021.
However, online gambling sites have controls in place that address Adelson’s concerns. Those technologies are likely what the Sands executive board is exploring now. But they won’t have to convince Sheldon Adelson. They have to convince his wife, Dr. Miriam Adelson, who had a 41.6% stake in Las Vegas Sands in 2013. However, since Sheldon Adelson’s death, Dr. Adelson has just under a 57% stake in the company. She’s the controlling shareholder, making her one of the most influential members of the company.
If she shares her late husband’s objections to online gambling, then Las Vegas Sands and the Adelson family will likely continue pushing against online gambling expansion.
Myth-Busting: Sheldon Adelson’s Objections To Online Gambling
Sheldon Adelson’s moral objections to online gambling were clear and credible. Not only did he fund campaigns against online gambling. His own company also has no online gambling operations. He had two main objections to online gambling:
- Underage gamblers could use gambling apps and sites.
- People who couldn’t afford to gamble would abuse gambling apps and sites.
Technologies exist to combat both these concerns. Here’s how legitimate online gambling websites combat underage and problem gambling.
This is the easier problem that modern technology can solve. Licensed sportsbooks must adhere to know your customer protocols. Among other things, that means sportsbook must verify bettors’ ages before allowing them to even deposit money. Some sportsbooks use bettors’ social security numbers to figure out how old they are. Others go further and require bettors to upload government IDs before allowing them to make deposits. Using both would be a reliable check against underage gaming.
Problem gambling is tougher to identify but has a partial solution. If a sportsbook notices changes in a bettor’s wagers, it could ask for proof of income. Bettors could supply proof they can afford to bet at a sportsbook, and the sportsbook could sign off on it.
If that sounds starry-eyed and unrealistic, it’s not either of those things. It’s how sportsbooks conduct business in the UK. The UK Gaming Commission requires sportsbooks to verify to the best of their abilities that their bettors can afford to gamble with them. Las Vegas Sands could implement these same measures and take control of their bettors’ gambling themselves. It’d have some of the tightest controls in the American online gambling industry. But they would be able to address problem gambling among users.
Would Las Vegas Sand’s New Majority Shareholder Approve Online Gambling?
Possibly, but it’s unclear. Dr. Adelson was widely recognized as Sheldon Adelson’s “co-partner.” The Guardian even reports an incident where Dr. Adelson told Sheldon Adelson that part of his interview with a journalist should be off the record. She wasn’t a passive observer of the casino business and is unlikely to become one.
There are two ways online gambling could come to Sheldon Adelson’s company. One would be to convince Dr. Adelson to allow it. The other would be an overrule by the Board of Directors.
Convincing Dr. Adelson
The most likely way online gambling will come to Las Vegas Sands is with Dr. Adelson’s blessing. Sheldon Adelson kept most of the shares in his family to retain control of Las Vegas Sands. It let him guide his company in the direction he wanted–including forbidding online gambling. There was no coup, and there’s no newsworthy friction has been reported. So, they must have worked in harmony for some time. It’s clear they respected Sheldon Adelson.
If the new CEO wants to expand into online gambling, he’ll likely have to sell Dr. Adelson on it. The precautions we’ve outlined in the last section would likely be some of the main points. As an unofficial co-partner, Dr. Adelson likely shared some of her late husband’s concerns about online gambling.
Overruling Dr. Adelson
This is not a viable strategy for two reasons. First, Dr. Adelson owns more than half the company. Good luck outvoting her.
The second is the Board’s likely feeling of obligation to run the company with respect to Sheldon Adelson’s wishes. His memory won’t control the company. But he won’t be disregarded, either, especially during this early transition period. (At the time of this writing, Las Vegas Sands has had a new CEO for six days.) They’re not going to slap the Adelson family in the face by upending the company’s direction.
The Board is also probably made of people who agreed with Sheldon Adelson’s vision. Even though they’re more open to online gambling than Sheldon Adelson was, they may share some of his caution. The early looks at online gambling are probably just that. Tentative looks at whether online gambling is right for Las Vegas Sands.
If Dr. Adelson is ungraciously overruled–there’s not really another way to overrule the majority shareholder–it’ll be big news. Look for Dr. Adelson’s blessing instead.
Las Vegas Sand’s Future
Losing Sheldon Adelson was a loss to the company. It was such a big deal that it had to be included in its SEC filings. But don’t make the mistake of discounting Dr. Adelson’s role in shaping the company’s strategic direction. She’ll likely leave the day-to-day operations to the new CEO, Robert Goldstein. She’s an addiction specialist, so she has her own career and political priorities. (It’s been reported that she’s the driving force behind political donations.) That leaves the big-picture strategy to her.
However, the Board has influence, too. They have the direct experience in the casino industry that could sway her vision for the company. But her guiding vision was likely similar to her late husband’s. The Board will likely work to reconcile their intimate industry knowledge with Dr. Adelson’s vision for the company. She will probably not be the casino personality that Sheldon Adelson was. However, there are other areas where she can take a leading role. Expect Robert Goldstein’s role to become more important while Dr. Adelson pursues other more pressing interests.
But don’t expect Las Vegas Sands to go anywhere. It remains financially secure with a strong executive team. Las Vegas Sands suffered a loss when it lost Sheldon Adelson. But its future remains bright.