On the 23rd of December the US Department of Justice issued an interpretation of existing gambling laws and the Wire Act and concluded that the prohibitions were only applicable to sports betting and not other forms of gaming that could include Internet poker, casino, and lotteries. The interpretation was sought by the New York State Lottery and the Illinois Lottery on behalf of their software suppliers GTECH.
Commenting on the news Warwick Bartlett CEO and founder of Global Betting and Gaming Consultancy (GBGC) said “This is an important game changer; Internet companies have had a tough 2011 and with the prospect of a relaxation to current law in the US 2012 looks like being a better year.”
The main beneficiaries to begin with will be the state lotteries, and the software suppliers to those lotteries such as Lottomatica GTECH and Playtech. Various European lotteries have proven that the lottery model works particularly well for the Internet because the player has an audit trail of his selections; the lottery notifies him when he wins and there is no embarrassment through potential loss of a ticket. Figures show just how successful Internet lottery has proven to be.
However it is not all plain sailing, many agents depend on the weekly traffic for lottery sales and they are generally
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opposed to the move online by lottery companies. According to GBGC, the current Internet market in the US is worth as follows: Internet Casino US$372 million, Poker US$485million, which had revenues at US$1.8 billion in 2006 before UIGEA, and Bingo US$445 million.
“The current US lottery market is worth about US$55 billion in sales. We estimate that given the high penetration of broadband in the US that lottery sales on the Internet could reach US$10 billion quite quickly if all of the states embrace this wonderful opportunity. In Europe lottery proceeds are generally spent on good causes such as sports and charities but in the US the need for raising revenue is more pressing because lotteries fund major state works and education. A lot of state governors will be happy with this news,” said Warwick Bartlett. (E-01.05.12)
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