Barry Diller knows a thing or two about getting between hotels and their guests. He assembled Expedia, Hotels.com, TripAdvisor and Hotwire under IAC, then spun them off as Expedia in 2005. So when his company People Inc. (formerly IAC) offered roughly $18 billion in June to take the rest of MGM Resorts private, his reasoning caught my eye. Diller pitched the deal as a hedge against AI eating his media business. He argued that no technology can get between a person and the desire to physically be somewhere, like a resort or a casino floor.
Nice theory, but the financing didn’t come together. People Inc., which already owns 27% of MGM, walked away on September 23, saying the mix wasn’t working. Bloomberg reported Diller had trouble lining up the equity. MGM stock dropped about 10%, and the board says it’s happy going it alone. The timing wasn’t great anyway. Strip occupancy was flat in Q2 and rates were down 4%, so Vegas isn’t exactly printing money right now.
Diller may be right that AI can’t replace actually being somewhere. But AI-proof isn’t the same thing as a good investment, and it sounds like the people he needed to write checks weren’t fully sold either. Vegas demand is softening, costs keep climbing, and money isn’t cheap. If that sounds familiar, it’s the same math problem we laid out in our hotel owners’ story. The robots may eventually take over, but in this case, the spreadsheet ruled the day.
