It’s 1:30 a.m. as Saturday turns into Sunday in Las Vegas, and Neil Moffitt hasn’t had a drop to drink. His 3,000 guests, churning under strobe lights at Hakkasan, the brand-new 80,000-square-foot nightclub complex Moffitt oversees, are another story. Hopped up on vodka, Red Bull and who knows what else, they’re gyrating to the latest electronic concoctions of Calvin Harris, a DJ who last year made $46 million, more than Derek Jeter and Kanye West–combined.
For Moffitt the $300,000 or so he’ll likely pay Harris this night is easily justified. He applies the same per-head math that Vegas uses to draw in gamblers: Visitors–excepting a few VIPs and attractive young women–will likely pay $50 just to get in and might drop $100 on drinks. Moffitt even has his high rollers: A handful will shell out $10,000 or more for one of the club’s prized tables. “Calvin is a line item,” he says, “that fell within our business model.”
This formula provides the newest salve to Sin City’s wounds. Visitor volume, the key metric to Vegas’ fortunes, dropped 5% between 2007 and 2010. Still worse, gaming revenue dropped 18% over the same period, as Nevada’s onetime oligopoly on games of chance continues to erode, forcing the Strip to reinvent itself yet again.