Marriott and MGM Resorts Delay Rewards Tie-Up after Data Breach
Marriott International and MGM Resorts International have postponed their highly anticipated customer loyalty partnership until next year due to MGM's ransomware attack in September.
In July, these two giants in the travel and leisure industry announced the MGM Collection with Marriott Bonvoy. Under this long-term strategic licensing agreement, MGM's 17 domestic properties, including those on the Las Vegas Strip and regional casino hotels, were set to be integrated into Marriott's platforms. The partnership was initially scheduled to begin this month but has now been pushed back until 2024. Some speculate that the September cyberattack by the hacking group "Scattered Spider" on MGM is the culprit for the delay.
Despite MGM's claim that they didn't pay the ransom demands and have moved on from the attack, they incurred $10 million in one-time expenses related to the incident and a $100 million dent in their third-quarter earnings before interest, taxes, depreciation, amortization, and rent or restructuring expenses (EBITDAR).
Postponing Marriott and MGM Partnership Makes Sense for Security Reasons
Both MGM and Marriott handle sensitive customer information, making security a top priority in this partnership.
In a letter to customers, MGM's CEO, Bill Hornbuckle, said that the perpetrators gained access to personal details like "name, contact information, gender, date of birth, and driver's license number" of those who did business with MGM before March 2019. Some customers might have had their Social Security or passport numbers stolen as well.
With over 40 million members in MGM Rewards and nearly 180 million participants in Marriott Bonvoy, the potential scale of their rewards programs could contribute to the delay. To minimize reputational risk, it's prudent for Marriott and MGM to proceed cautiously with their partnership. Marriott is no stranger to cyberattacks, having experienced them in 2014, resulting in a $24 million fine in the UK in 2020 and another in the previous year.
Logistics May Also Be a Factor in the Delay
Although not officially confirmed, the ransomware attack on MGM could be just one reason for the delay in their partnership with Marriott. The intricacy of the deal and various tiers associated with different MGM casino hotels could also play a part.
Of the 17 MGM resorts joining the MGM Collection with Marriott Bonvoy, four properties will be part of existing Marriott collection brands: Bellagio Resort & Casino will be a part of The Luxury Collection, ARIA Resort & Casino will become a member of Autograph Collection, Park MGM will be integrated into Tribute Portfolio, and The Cosmopolitan of Las Vegas will keep its Autograph Collection affiliation. The remaining MGM Las Vegas Strip venues not mentioned above and five of their regional casinos will also be part of the partnership. These include Borgata on the Atlantic City, N.J. Boardwalk.
Read also:
- Remaining contenders down to two in DFB's struggle versus Brazil.
- Schalke's Transfer Assessment: A Season of Wastefulness
- Shocking development in the NBA!
- Law enforcement agencies in various metropolises plan expansive measures for May 1.
Source: www.casino.org
