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shufflemaster rfid

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									Corporation: Shuffle Master

Shuffle Master, Inc. develops, manufactures and sells or leases technology-based products
to the gaming industry. In 1982 truck driver, John Breeder, after reading about casino
frustration with card counting, designed an idea for an automated card shuffler. In 1992, the
first card shufflers were produced and Shuffle Master began. Based in Las Vegas, NV, the
company provides utility and entertainment products to casinos worldwide. Utility products
that are intended to improve productivity, profitability and security to casinos include a full
line of automatic card shufflers, chip sorting machines for roulette and interactive betting
interfaces. Other products include intelligent systems that automatically track data on table
play to provide real-time information to back-of house and pit operations. On the
entertainment products side, they provide a wide variety of proprietary table games in both
live felt and electronic format. The company has also formed Shuffle Up Productions TM,
Inc. ("Shuffle Up") to develop live and broadcast tournament events as well as merchandise
based on our extremely popular gaming offerings. In November 2005, Shuffler Master
hosted the finals of Three Card Poker National Championship TM with a grand prize of
$1,000,0001.

Business Outlook
Despite a second quarter report in which the company earnings performed below market
analyst expectations because of research investments and acquisitions2, the company has
grown consistently and had a steady increase in revenues. The chart below indicates the
growth of the company’s stock prices over the last 5 years3. Within the last 52 weeks, stock
price has ranged between $22.49 and $40.75. Its expected one-year target estimate growth
is to $43.07. Their annual revenue is currently at 112.9 million dollars, up 33.1% from the
$84.8 million in 2004 and nearly double the $67.4 million in revenue from Oct 20034.
Shuffler Master’s current stock price is around $33 a share.




Customers Their primary customers are casino owners to whom they sell directly in the US
and through strategic partners internationally. They have expanded their product
distribution into markets world wide including Europe, Asia, South America, and Australia
as well as cruise ships. Their innovation in electronic gaming equipment allows them to
provide products to markets where live table games are not permitted, including racinos and
video lottery markets. While their target customers are the casino business owner, the
creation of novel table games are developed with the players in mind to increase demand
for these games on the casino floors. By providing interactive video play of table games at a
fraction of the cost of live table games they appeal to the lower stakes players. The
development of tournament play also increases public interest in their propriety games.

Technologies used
Shuffler Master incorporates several technologies into their gaming products including the
following1:

      The company is incorporating either economical optical technologies or more
       accurate RFID technology into chip tracking wagers at the table to provide data
       management. In 2004 the company obtained 2 RFID patents, allowing them to
       develop products incorporating RFID and collect royalties from competitors already
       using RFID5.
      They are using wireless technology to deliver gaming on handheld devices within
       the casino. The devices include popular propriety table games, slot games as well as
       opportunities to place wagers on racing and sporting events. On January 13, 2006,
       Sona Mobile entered into a strategic alliance with Shuffle Master to license,
       develop, distribute and market the in casino, handheld devices6.
      The integration of software systems at use in the casino allows for the development
       of intelligent systems to assist pit and back-of-house operations. By tracking all
       casino activity in real-time the intelligent systems can produce accurate statistics
       and player rating information to improve management operations.
      Shufflers, the signature product of the company, automatically read and verify cards
       and randomly shuffle multiple decks to prevent card counting while speeding play.
      Table Master is the company’s interactive, personable video product, which
       combines a dealer and live game with an electronic betting interface.
      Rapid Table games have individual computerized touch screens for players to make
       their wagers. Once each round is completed, all wagers and cash balances are
       instantly resolved. Its surveillance, accounting and auditing capabilities eliminate
       the typical mistakes and disputes that confront live table game dealers and players.

Competitors
Shuffle Mater’s primary competitors include: Gaming Partners International Corp. with
sales of 57.1 million in 2005, Progressive Gaming International Corp. with sales of 78.2
million in 2005 and Vending Data Corp. with sales of 2.4million in 20057. However,
Shuffler Master continuously leads the market and through strategic partnerships in some
cases turns competitors into collaborators (see below in competitive advantage).

Leaders
The Chairman and CEO is Mark L. Yoseloff, PhD, who joined Shuffler master in 1997. He
has PhD in finite mathematics from Princeton and over 20 years of experience in design,
development and manufacture of electronic games. President, Chief Operating Officer,
Secretary & Treasurer is Paul Meyer who joined in 2003 and has experience in software
development in the entertainment industry. Vice president and Chief Financial Officer is
Richard Baldwin, formerly of International Game Technology, Inc. who has extensive
experience in investment in this industry. R. Brooke Dunn, a Senior Vice President, has
experience in marketing to the gaming and entertainment industry.

Competitive advantage
The competitive advantage of Shuffle Master is due largely to its innovative incorporation
of technology into gaming products and its strategic partnerships that support research
collaboration and worldwide distribution. It is the industry leader of utility products
because of their ability to minimize errors and cheating and improve tracking and reporting.
Development of innovative table games and the technology to deliver them to an increasing
number of players places the company as a leader in entertainment product sales because
public demand for their games commands more floor space in casinos. Shuffler Master is
the producer of three of the top five specialty table games on the market.

Their strategic partnerships include the following8:
    International Game Technology and Progressive Gaming International Corporation
        which entered into a worldwide product integration agreement with Shuffle Master
        to create a comprehensive, automated table management solution utilizing each
        company's complementary capabilities, technologies and resources.
    Ameranth Wireless for production of software interfaces for their Deck Mate®
        poker shuffler
    Casino Solutions S.A. as exclusive distributor throughout South America
    Machines Games Automatics, S.A. (MGA) as exclusive distributor of Table Master
        to arcades throughout Spain.
    StarGames Corporation Pty. Ltd. with Shuffle Master acting as exclusive distributor
        for a StarGames Rapid Roulette System in the Americas and on cruise ships
        departing from the US.
    Service Gaming Europe, Ltd. (SGE) as exclusive distributor of Table Master in 10
        European countries.
    Gaming Equipment Manufacturing, (GEM) as exclusive distributor of shufflers and
        table games in the Russian Federation and other nearby countries like Ukraine and
        Moldavia.
    JCM American Corporation in a strategic alliance in which the JCM Trident TM
        system, a table game drop management system, featuring the Intelligent Cash Box,
        will be used on Shuffle Master's felt based table games.
    Melco International Development Limited as exclusive distributor to Asia.
References:

1. http://www.shufflemaster.com/

2.
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B22D180D4%2DEBF6%2D45BA%2D9812
%2DECC353F5D04A%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

3. http://finance.yahoo.com/q/bc?s=SHFL&t=3m&l=on&z=m&q=l&c

4. http://www.hoovers.com/shuffle-master/--ID__17079--/free-co-
factsheet.xhtml?cm_ven=PAID&cm_cat=BUS&cm_pla=CO1&cm_ite=Shuffle_Master_Inc

5. http://www.investors.com/breakingnews.asp?journalid=28241340&rb=1

6. http://www.sonamobile.com/newsrelease.asp?article=2006-01-27

7. http://finance.yahoo.com/q/co?s=SHFL

8. http://www.shufflemaster.com/01%5Fcompany/Strategic%5FPartnerships/

								
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