Public Gaming International May/June 2020

81 PUBLIC GAMING INTERNATIONAL • MAY/JUNE 2020 them to appreciate that it is not just about preserving the funds being channelled to support good causes (though there is that of course). It is also about protecting the consumer, countless millions of players, and stopping the expansion of criminality in the world of lottery and gambling. Preserving the funding for good causes, protecting the consumer, and preventing the expansion of criminality is a priority. We not only need to rebuild the economy but also the societal infrastructure where sports, culture, education, social cohesion and R&D can thrive again. And the later we start, the more we will lose to illegal competitors and the harder it will be to reclaim all that has been lost. We can’t wait until we are out of crisis management mode to begin the dialogue with all of our stakeholders on how we can rebuild and come back stronger than ever. e priorities and strategies will vary across jurisdictions, but they will likely include ambitious goals to invest in and implement new technologies and distributional methods. Government-lotteries need to again assume the important societal role of providing the necessary funds to rebuild the non-economic parts of our society. is whilst o ering a wide variety of modern, integrity-rich, consumer-friendly, and entertaining games- of-chance. Last weekend we witnessed an amazing solution to address the void in our cultural lives caused by the cancellation of a major cycling event in Belgium (https://www.bbc. com/sport/cycling/52175417 : Virtual Tour of Flanders: Greg van Avermaet wins online 'race' ). Several professional cyclists raced in the one-day event (Tour of Flanders) on training bikes in their homes. More than 600,000 people watched it online. is new hybrid form of sport proves that we can nd alternatives for cancelled sports events. To date, betting on E-sports and virtual betting have not been fully embraced by lottery operators mainly due to regulatory constraints. ese constraints need to be relaxed to avoid a situation where the sport betting market slips from the hands of lottery operators and into the commercial sector. e lottery market must be allowed to nd new solutions, like E-sports and virtual betting and innovations in distribution, to address the demands and needs of consumers. Interactive scratch tickets may not have been fully embraced by the o ine market in the past. But we need to recognize that the consumer gaming market will be quite changed when we emerge on the other side of the pandemic. Innovations that looked “promising” before are no longer ahead of their time. e crisis will reshape the ability of everyone to adapt to the new and di erent. I would respectfully submit that the ability to adapt will in fact intensify the desire for new and di erent. For instance, during the WLA/EL marketing seminar, the Polish Totalizator Sportowy (TS’ Pay-out Direct) demonstrated a solution to pay out winnings directly to payment cards. ese types of solutions, as well as player cards, tablets, smart phones, connections (plug-ins) to cashier systems and other cashless payment solutions may a ord new opportunities for play and prize pay-outs without a ecting RG and security perspectives. In the past, regulators and legislators did not fully understand the need for a rapid response to market challenges. It may have been the fear of losing control of the situation or it may have been that they did not really accept that the illegal market is a very serious threat. Or maybe lottery operators need to nd more e ective ways to convince regulators of the need to respond quickly to market challenges. Whatever the answer is, today’s circumstances combined with the urgency of the situation must lead to change. Lottery operators and their trade associations need to forge a united front to encourage regulators and shapers of public policy to modernize regulations. Our industry need leadership in the form of a stronger multi-disciplinary approach whereby technology suppliers, sales and marketing people, responsible gaming, security as well as legal experts gather around the table with an open mind to work on these solutions. From our side, as experts on matters of legal and regulatory importance, we are ready to take up these challenges. 1 Philippe.vlaemminck@pharumlegal.eu 2 dawid@div-one.com 3 Philippe Vlaemminck & Dawid Muller have joined forces in Pharumlegal to strengthen the legal team serving the lottery community 4 BBC.com/sport/cycling : “Belgian Olympic road race champion Greg van Avermaet was crowned as winner of the Virtual Tour of Flanders as 13 riders raced in the one-day event on training bikes in their homes. e race was scheduled to be held in Belgium on Sunday, but was postponed because of the coronavirus pandemic.(…) e virtual 30km course was streamed live on YouTube. It covered the nal three climbs of the real-life 267.2km route, with live video links to all the participating riders. (…) Horse racing has also turned to technology this weekend, with a virtual Grand National raising £2.6m for NHS Charities Together.” Vlaemminck/Muller continued from page 82 Pat McHugh continued from page 55 e lottery industry will need to engage with policymakers. As we’ve seen in the news, this pandemic has highlighted the limitations and vulnerabilities of the lottery industry’s primarily all-cash, in-person business model. Lotteries must modernize to weather future crisis, as they inevitably occur. Annual U.S. state revenues from traditional lottery are $24 billion. at’s a big number and it funds vital programs for education, seniors, health and welfare, veterans, the environment, and infrastructure. e COVID crisis has resulted in a devastating 20% to 40% declines in this crucial funding. As both state and lottery revenues trend downward in the U.S., we expect the number of lotteries with online o erings to increase. As you have seen, Governor Lamont of Connecticut and Governor Scott of Vermont both already proposed an expansion of their state lotteries online. In states where players can purchase lottery games via online/mobile, we have seen increases in rst-time players, overall sales and online revenue. Players are choosing to play at home while they stay at home, if they have the option. In the few states with mature iLottery programs such as Kentucky, Michigan, North Dakota, Carolina and New Hampshire, state revenues were already increasing 27% to over 100% year-over-year. What’s inspiring to states looking to launch online/mobile lottery sales, is that during its rst full scal year of iLottery, Pennsylvania traditional lottery sales grew 7.2% over the prior scal year and Scratch-O s alone grew 5.9%. is can be credited largely to the e ective management of the entire game portfolio, delivery of exciting iLottery content to the market, and tools to enable retailer support, while continuing with the strategic management of all traditional lottery products sold at brick-and-mortar retailers. Lotteries should be cautious in choosing the right iLottery business partner. It must be a company that can not only technically launch an iLottery program quickly, but also make it commercially successful. is requires experience in retail and digital game portfolio management, consumer research, player acquisition and retention programs, and omni-channel platforms. To be truly successful, the program must be supported by marketing experts who know how to e ectively use powerful CRM tools and bonusing programs that can engage and retain their players.