Charting a New Course

New American Gaming Association (AGA) President and CEO Geoff Freeman has spent most of his first few months on the road, immersing himself in the industry he is charged with representing in Washington and gathering information that will help chart the lobbying organization’s course for the future.

Freeman, 39, sat down for an interview during the Global Gaming Expo (G2E) in September to discuss his first 90 days after taking the reins July 1 from Frank J. Fahrenkopf Jr., who had held the role since the association’s founding in 1995.

“Frank built an incredible foundation here at the AGA. I’m excited to be here,” Freeman said. “It’s been a great ride so far. I’ve spent a lot of time traveling around the country—Las Vegas, Atlantic City, Tunica, St. Louis, Kansas City, probably a couple of other destinations—learning the industry, learning the people in the industry, spending some time understanding the back-of-the-house aspects of the industry, spending a lot of time with not just operators but manufacturers as well, and it’s been great.”

Freeman already is getting good marks for his performance to date.

“Geoff has shown in his first few months on the job that he is both a thoughtful and energetic leader,” said Richard Haddrill, chairman of the board of Bally Technologies and chairman of the AGA. “He already understands our industry, has a deep public policy background and an extensive network of relationships in Washington and has the skills to build coalitions and execute grass roots campaigns. Our industry has evolved significantly in the last five years, and so have our public policy strategies. I am personally looking forward to working together with Geoff in the coming months and years on shaping these strategies to help our industry.”

Marcus Prater, executive director of Association of the Gaming Equipment Manufacturers (AGEM), said he appreciates Freeman’s methodical, intelligent approach to understanding the industry. “I’ve admired the fact that he has been out really immersing himself in our industry, learning the issues, learning the different players and doing all of that before he puts all of his cards on the table,” Prater said. “Now he’s starting to implement his vision for the next chapter of the AGA’s history.”

Prater said he has been impressed with the transition so far. “It’s a true changing of the guard. It’s been a very active 20 years, and I think the challenges are different now,” he said.

Prater also noted that Freeman has included AGEM and the needs of its members in his thinking perhaps more so than the AGA had in the past. And Freeman comes to the AGA without predisposed opinions on the industry.

However, Freeman has definitely developed some opinions since he has spent those weeks and months visiting gaming jurisdictions around the country. Those travels have left strong impressions. “One is that the industry’s about innovation and always looking at how do we innovate, how do we evolve, how do we do things a little bit differently than we’ve done in the past,” he said. “That’s exciting to be a part of because there are so many industries that are not that way. There are so many industries that are just more about ‘how do we kind of protect the status quo.’”
Another aspect that stands out is that, whether the industry is aware or not, it is seeking common cause, Freeman said. “It is ready to take that step. What’s brought us together in the past is the possibility of harm,” he said.

Fahrenkopf was instrumental in leading and helping to protect the industry through a period when the potential for harm was very real. “What I have to do as a new leader coming in is ask myself, ‘Is this an organization that’s broken and needs a change? Is this an organization that is flying high, and I just need to keep it on autopilot? Or is this something in the middle that is a good organization with a strong foundation that’s ready to write the next chapter?’ And I think it’s that.”

The question now is, how does the AGA evolve? “What is the AGA’s cause? What are we there to do? That needs to be more apparent. And not just externally; it needs to be more apparent internally, and we’re working on that,” he said.
Freeman believes the AGA will likely focus on three areas.

Championing the Industry
“One is about preventing harm but doing so in a very proactive manner. I look to see the AGA very much go on the offensive. We have a lot to be proud of. This industry is an economic engine. We are extraordinary community partners. We take care of our employees,” he said. “We’ve got a great story to tell, and we need to get out there and actively tell our story, more aggressively, more proactively, or others are going to write that story for us.”

Freeman noted that enthusiasm for the AGA to exist simply to prevent bad things from happening has started to wane because many no longer believe there are many threats to the industry.

“Now, trust me, there are a lot of threats. And there are more threats to come in the years ahead. As the dynamics in the Senate shift, as people who may have disliked and have had challenges with this industry all along, some of those folks are bound to come out of the woodwork in the years ahead, and we’ve got to be prepared for that.”

One way to do that, Freeman said, is for the AGA to be much more aggressive about recruiting champions. He notes that commercial casino gaming exists in 23 states and tribal gaming is in 40 states. “That’s over 80 senators who have casinos in their states. Where are those champions for this industry and what we’ve done? Who are the House members who have casinos in their states? Where are those champions? We’re going to really focus on that, just being more proactive in our efforts.”

And that’s something that can be accomplished, he said, even in today’s difficult political climate in Washington. “Recruiting champions and helping these champions go back home and talk about the jobs that they’ve helped provide, the economic development they’ve helped make possible because of their relationship with the gaming industry, that’s an opportunity where we can make them look good, and we should give them an opportunity to highlight the good work that they’ve done.”

Growth Factor
A second area, he said, will be about facilitating growth. “It’s not enough for us to exist just to prevent bad things from happening. How do we help the industry grow?” That growth could come through expansion, through removing barriers that allow more consumers to enjoy the product, through reducing costs from an overly burdensome regulatory environment or from some other avenue, Freeman said. The AGA needs to define those opportunities and work toward enhancing those and enabling the industry to thrive, Freeman said.

“We’re going to figure those out. I think the regulatory environment is the best example right now,” he said.

“The industry as a whole has been doing a very good job in talking about the regulatory burden, the inefficiencies that it creates, the costs that it creates, all the downsides of the regulatory process,” he said. “[And] that many states are really discouraging, if not preventing, companies from innovating.”

Going forward, what the industry must do is focus on identifying the incentives for a regulatory body to want to make change, Freeman said.

“And I think the big benefit would be for those states that see the industry as an economic engine, they can embrace policy that empowers the industry,” he said. “The more we’re seen as a necessary evil, the more likely we are to get policy that discourages innovation and promotes inefficiency. Finding the incentive for those states is more of a challenge, and that’s why a big opportunity for the AGA is to bring more and more states into that economic engine category. The more states that see us in that light the more likely we are to find a regulatory environment where our companies can thrive.”

Freeman said the AGA has been continuing to work closely with AGEM to address some of those issues. “I see AGEM as a great partner, and I see great potential in working closely with their community and with the manufacturers in general,” he said. “I’m excited about that.”

Beyond the CEOs’ Offices
A third important area for the AGA will be to extend the benefit the organization provides the industry beyond the presidents’ and CEOs’ offices.

“That’s where I think there’s tremendous opportunity,” he said.

Freeman tells the story of talking with prominent property-level managers who have essentially given him the same message. “Their message has been, ‘I don’t know what the AGA does.’ And my response would be, ‘If three years from now, you still don’t know what the AGA does, then I’ve failed because as property managers, as leaders and executives in this industry, you should know what your association does, and that means we have to provide greater value across the industry and then effectively communicate the value of our product.‘”

That brings Freeman back to the questions of the AGA’s constituencies and its common cause.

“One of the questions we have to ask ourselves is, who are we? Are we the commercial casino operators only? Are we the commercial casino operators and manufacturers who are there because they think they’ve got to be there because these are their customers? Or are we the gaming industry? And if we’re the gaming industry, are we looking for common cause that we have with operators, manufacturers, tribes? I’m inclined at this early stage as we look at where opportunity is I think the greatest opportunity is in representing the totality of this regulated gaming industry. We’ll see if others agree and if the energy’s there,” Freeman said. ”I’m hopeful that we can aim for that bigger picture.”

Freeman noted that gaming’s various constituencies won’t always agree on everything, but he said, “My hope is we can figure out what do we all agree on and how do we go pursue that.”

Freeman achieved success finding that common ground in his previous position with the U.S. Travel Association, where he served most recently as executive vice president and chief operating officer.

“On the travel industry front, we represented all the hotels, all the theme parks, all the rental car companies, all the major destinations, all the online travel agents,” he said.

They were constantly battling each other over market share, costs, and other issues, he said. “We had to find what is the common thing that every one of these entities agrees on. We found it. They all want more people traveling, which gave us, once we identified that, the opportunity to identify those barriers to travel, whether it was the TSA, whether it was the international entry process with visas and customs, whatever it may be, and we had to remove those barriers.”

Freeman said he believes the same thing will be true with the gaming industry. “We have to start by figuring out what is the one thing we all agree on. Once we have success working together, we can identify other things that we want to put on that [list]. Success begets success. And I think that’s going to be kind of the motto of the AGA.”

One of the biggest developments the gaming industry is facing is the legalization of online gaming, Freeman said. “My point of view is online gaming is here, and the only question is are we going to effectively regulate this product or are we going to continue to allow this more kind of rogue operating environment that we see today?”

Freeman noted that Americans spent about $3 billion online in 2012. “The demand is there. Now we have Nevada online. New Jersey is online. Delaware is online. It’s here. Our position has been and remains that the best approach here is for the federal government to step in and set some consistent standards.”

The AGA would like to see the federal government take three steps, Freeman said. The first is to set minimum standards for consumer protection, including age verification and responsible gaming. The second is to provide a framework for Native American tribes to participate and the third is to give law enforcement the tools it needs.

Realistically, Freeman said he holds little hope that federal regulations will happen. “I don’t think that policy makers appreciate the risk in doing nothing. They’re most likely to let the status quo go and the most likely result is the state-by-state approach that we have today, and we all need to adapt and prepare for that,” he said.

Freeman noted that if the federal government doesn’t act, gaming companies and the AGA won’t stay on the sidelines. “As states move forward, we will move forward and engage in those states, and we will do everything we possibly can to push and recommend a regulatory framework.”

The federal government could eventually revisit the issue, Freeman said. “I wouldn’t be the least bit surprised that in five years or so from now they say, ‘What did we create here?’ and try to develop some minimum standards.”

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