Now that sports betting is legal, the North American Association of State and Provincial Lotteries (NASPL,) which represents government-backed lotteries in Canada and the U.S., says the industry wants a place at the table. Lotteries worry that sports betting could siphon away money that is now spent buying their product.
Currently state lotteries disburse about $22 billion in state programs and scholarships.
In a statement NASPL President Charles McIntyre noted that state lotteries provide money to schools and other government programs. “As states begin to consider sports wagering, the lottery industry is ready to help establish the real-world network that would be involved if called upon to do so.”
NASPL has long supported repealing the Professional and Amateur Sports Protection Act (PASPA), the federal law that banned sports betting in all but four states. It also opposed a proposed ban on internet gaming in 2011 and 2012, arguing that this was a federalism issue and best left to the states.
The U.S. has more than 200,000 retail lottery locations, said McIntyre, such as bars, clubs and taverns that would be natural locations for sports betting. This could be combined with the online presence that some lotteries already have. These web presences could easily be converted to sell sports betting products, he said.
He noted that lotteries already possess the technological expertise that would be needed to deploy sports betting on websites and mobile platforms.
The Lottery and casino industries have increasingly become conjoined, especially in the manufacture of slot machines. The largest slot manufacturers, IGT and Scientific Games, have extensive lottery divisions. Scientific Games recently acquired NYX Gaming Group, a global supplier of sports betting platforms. Often slot machines are employed by state lotteries. Ohio’s seven racinos, for example, employ video lottery terminals (VLTs) and are almost indistinguishable from other casinos.
Brad Cummings, founder and CEO of EquilLottery, calls sports betting, “the next big growth category.” Interviewed by Totally Gaming, he said, “Lotteries should look into creating new categories that are available to them now or in the near future, specifically sports gaming, which would have the chance of competing with other gaming entities. Every time a state legislature is looking at the issue of sports gaming, the lottery should ensure language is included to allow for a live sports lottery option.”
He added, “Some states allow at least live horse racing to be a basis for a lottery game, some states prohibit any live sports integration with lottery and most are silent on the issue.”
Cummings urges state lotteries to fight to be included and to be allowed to offer forms of sports betting as part of their products. “[T]he lotteries have some unique advantages that allow them to solve problems that traditional sports gaming cannot; a big one being the licensing fee leagues are demanding for their product to be utilized. Since the margins are much larger on lottery games, especially draw games which I think are the most analogous to a live sports lottery category, the fee won’t be cost prohibitive like it can be if taken out of a vig,” i.e. the house take.
