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Analyst: Celine Dion is Bad Bet

31 January 2003

LAS VEGAS – As reported by the National Post: "In the never-ending battle for `buzz' and notoriety, Las Vegas casinos still often spend money first and ask questions later.

"The latest dubious bet in the city's entertainment industry may be about to unfold with Park Place Entertainment Corp.'s US$100-million investment in Celine Dion, according to Merrill Lynch analyst, David Anders.

"The Quebec-born pop diva will open her stage show A new day in March in a 4,000-seat theatre at Park Place's flagship Caesar's Palace resort.

"The company built the auditorium specifically for Ms. Dion, at a cost of about US$100-million. But, according to Mr. Anders, while Caesar's will certainly get a lot of attention from its association with Ms. Dion, the company's chances of making a decent return on that investment are a real longshot.

"…`The math doesn't work on Celine,' Mr. Anders said in a December research report.

"Caesar's signed a three-year deal with Ms. Dion performing 200 shows a year. Under terms of the agreement, Caesar's agreed to build an auditorium for the show resembling Rome's famous Coliseum.

"Caesar's gets none of the ticket revenue, and is hoping to generate a 20% return on its investment strictly through the money that audiences will spend in the casino and restaurants, before and after the show.

"…Caesar's Palace has long lacked a comparable big-name stage attraction, relying instead on its position as the prime venue for top boxing events in the city. But with resorts like The Venetian, Bellagio and Mandalay Bay eroding Caesar's share of the high-end gaming traffic, it needs to work harder to compete, analysts said…"

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