As published recently in Las Vegas Business Press, Harrah's Entertainment has seen the future and it lies overseas. That's the message sent by company CEO Gary Loveman during a recent swing through Europe to announce two new casino projects that mark Harrah's entry into the Old World.Don Quixote presides over the casino floor in this rendering of Harrah's planned Spanish megaresort."There are limited opportunities in the United States," Loveman told Reuters' Deena Beasley, adding that he is also looking to the Netherlands, Great Britain, Japan, South Korea, Taiwan and Malaysia. Harrah's is pursuing one of two megaresort concessions in Singapore and continues to express interest in the Macau market."These deals are not about throwing up slot warehouses with buffets," says James Rutherford, international editor of International Gaming & Wagering Business magazine. With U.S. prospects narrowing, Rutherford explains, it's incumbent upon American operators to go anywhere they spy opportunity.Harrah's Spanish initiative, El Reino de Don Quijote de la Mancha (The Kingdom of Don Quixote of La Mancha), is the consummation of a deal begun by Caesars Entertainment before its absorption into Harrah's and will carry the Caesars brand.Set on the plains south of Madrid, near Ciudad Real, the joint venture with Spanish investors is a master-planned community. A 50,000-square-foot casino will join an 800-room hotel, a clone of Caesars' Colosseum showroom in Las Vegas, a spa, restaurants, convention facilities, a Forum Shops knockoff and an already existing golf course, all reachable from Madrid in less than an hour via high-speed rail.Harrah's 60 percent share of the first phase of El Reino comes to $670 million, bringing the overall price tag to $930 million.On the other side of Europe, in Slovenia, Harrah's is stumping for a Vegas-style property, in equal partnership with Slovenia's predominant casino operator, HIT Group. Slated for Nova Gorica, a popular getaway spot on Slovenia's Italian border and home to HIT's two principal casinos (out of a total of eight), the Harrah's/HIT project would be the first full-amenity casino in the country, sporting 1,500 slots, 70 table games and a hotel of 800 to 1,200 rooms. It carries an estimated price tag of $700 million.The clock is running on the Harrah's/HIT alliance, which is exclusive for one year. During that period, Loveman and his Slovenian partners must convince the government (which is part owner of HIT Group) to roll back tax rates -- estimated at 38 percent to 50 percent -- and repeal a law that caps non-European Union ownership of Slovenian companies at roughly 20 percent. "These could wind up significant barriers to entry," Rutherford says.William Eadington, director of Institute for the Study of Gambling and Commercial Gaming at the University of Nevada-Reno, believes the repeal will pass, at least if restricted to casino ownership, because the Slovenian government wants significant, direct foreign investment. "They have the strongest economy of the new (EU) members," he adds, noting that Slovenia has closer ties to the West and ascribes more to Western economic values than do most new EU states."We're anticipating that the European gaming market is going to be increasingly like the American and Australian markets," Eadington adds, with fewer bureaucrats and more MBAs. He adds that, to achieve that American model, many European nations will have to change their laws and open their markets by relaxing protected regional monopolies and high tax rates.Taxes have already proven something of a flash point for Harrah's in Europe, with Loveman implicitly linking Slovenian investment to tax concessions and Harrah's spokesman Alberto Lopez catching flak for telling The Associated Press, "We're turning to places where it's easier to operate and where there's a more equitable tax rate."Asked to elaborate, Lopez told the Business Press, "There are those jurisdictions that make it very hard to operate by virtue of regulation and inequitable tax rates," although he named no names. "There are those jurisdictions that see the gaming industry as a perfectly legitimate industry, a highly regulated industry. Every one of the international developments that we announced in the last 30 days, it points to jurisdictions that would rather work with us as a partner than as an adversary."Spain's gaming-revenue tax rate has been stated as anywhere from 22 percent to 55 percent, although Loveman forecast a 10 percent rate on his El Reino project. Eadington attributes some of the confusion to Spain's marginal tax rates, which be believes escalate proportionally with the volume of revenue. If taxes on gambling are higher than Loveman expects, it could curtail development of the casino-based aspects of El Reino.Rutherford adds that, in Spain, "from Harrah's standpoint, this is about leveraging the Caesars brand -- probably the one name in U.S. gambling most non-Americans recognize," and the one that Loveman has designated for Harrah's top-of-the-line resorts, "in ways designed to elevate it to global prominence by marrying it to high-quality, mixed-used developments in which gambling is only one element ... which of course is what they're looking to do in Singapore, too."Lopez concurs. "El Reino is going the first time on continental Europe that this true brand value and equity of Caesars is going to be brought to bear, so it will definitely have the experience that people who frequent Las Vegas and Atlantic City would be accustomed to." He adds that, because Spain is the primary tourist destination for Europeans, Harrah's expects to draw high-end patrons from across the Continent.Nova Gorica's draw is more regional, with 79 percent of current play coming across the border from neighboring Italy. Both Trieste and Venice are within relatively short driving distance and HIT already has its two largest casinos there. "If you look at the fundamental demographics," Eadington says, "there are roughly 15 million (people) in northern Italy. The fundamentals are pretty good." He adds that Southwest Airlines-like short-haul air carriers are a plus to the market, as is a perennially chaotic Italian political climate that has impeded liberalization of Italy's casino industry, which Eadington describes as characterized by dowdy, older, unexciting gambling venues.HIT bucks a European trend, Eadington says, by pairing hotels with its casinos. This could further augment the tourist draw Harrah's envisions. "It's so close to Switzerland that you would also have that capability of reaching into that demographic, as well," Lopez adds.If all goes well in Nova Gorica, Eadington forecasts that northern Slovenia could easily be fecund with opportunity, given its proximity to Austria and its cities, which include Vienna, Innsbruck, Graz and Linz. Austria does have 17 casinos and racinos at present, though, most of which answer to a government-controlled oligopoly.Harrah's built its reputation and its empire in large part through database marketing but whether its famous Total Rewards program is deployed in Europe remains to be seen. "Our goal is to have them available," Lopez says, adding that he's unsure of the status. It's his understanding that HIT already has a player database, one that potentially might be fed into the Harrah's mass-marketing machine.No one envisions any cultural hiccups intervening between Total Rewards and overseas players. "The Harrah's database-marketing model is really a very sophisticated customer relationship management tool that can be used an applied in any international market," with only minor modifications to reflect cultural differences, according to Jonathan Galaviz, Las Vegas-based analyst for Globalysis Ltd. "Consumers in international markets appreciate loyalty programs just like consumers in the U.S. do."He adds that Harrah's database gives it the capability to cross-market its Spanish and Slovenian ventures as a means of generating visits from vacationing U.S. customers, for instance by offering loyalty incentives to a Harrah's New Orleans player that could be cashed in at El Reino. For its part, Slovenia's HIT Group has a travel arm, HITTours, that packages jaunts around Europe and as far afield as the Caribbean, although Lopez doesn't know yet whether Harrah's will incorporate it into its European marketing push."The question is, Does the American model work in Europe," Eadington asks. Once Harrah's spends a couple of billion dollars over there, he believes, we'll have the answer.