Lotteries have much to offer in new world order of sports betting

A gaming and lotteries veteran of circa 25 years, Richard Weil is among the most experienced and knowledgeable contributors to address the inaugural Betting on Sports America conference next week. The former Scientific Games, INNOVA Gaming Group and FUN Technologies (among others) man will be moderating a high-profile panel dedicated specifically to lotteries and the role they will play in shaping the newly legalized US sports betting landscape.

Ahead of his moderating duties, Weil spoke with SBC Americas to discuss the lottery sector and ways of encouraging a more joined up approach to a sector of business where lottery and betting could and should exist in perfect harmony.

Talking about the current picture, commercially and politically, Weil told us: “The US is going to be a complicated market, and domestic and international players are starting to learn how complicated it is state by state. The DoJ ruling on the Wire Act, which is as clear as mud, is a good example of that. There were political rumblings behind it and the rush to put out that opinion had much to do with PASPA.”

Weil’s assertion that the Wire Act revision was in some way a political pushback to the strikedown of PASPA is entirely plausible. But by hitting back at the betting sector policy makers have, he suggested, inadvertently caught the lottery business with the same haymaker.

“Firstly, no one understood the implications that the new opinion would have for the lottery business,” he said. “Secondly, and more importantly, they’re now faced with a problem that they have to learn how to fix because under the new DoJ opinion, lotteries cannot conduct business the way they currently do.”

Lottery to play out state-by-state

In terms of lottery involvement in sports betting, Weil predicted that it is highly likely to play out on a state-by-state basis. “There are some jurisdictions where the lottery is both operator and regulator, like in Delaware and West Virginia and in others where they are not involved. I think it’s going to depend at some level at how each state decides to regulate sports betting.”

Key to all of this will be mobile and it’s one area which, according to Weil, remains a political football. “As crazy as it seems you can’t buy a lottery ticket on your phone in most jurisdictions in the US,” he noted. “The idea of doing any form of gaming at a retail outlet or a casino doesn’t seem to bother the likes of Sheldon Adelson and those who hold similar views to his, but there’s just a real aversion here to mobile.”

In the short term at least, said Weil, the likelihood of mobile betting being accepted in some states appears slim at best. “It will be very similar to the UK in that it will be done on terminals, but the US lottery network is capable of supporting that approach.”

Which dovetails neatly with the theme of next week’s panel and the positive influence that lotteries can bring to sports betting. “The lotteries have thousands of points which are already regulated,” said Weil. “The other thing historically, especially in Europe, is that lotteries have been great sellers of sports betting games utilizing conventional retailers and self-service terminals (SSBT). They don’t see themselves as competing with casinos or traditional sportsbooks but as a complementary product. The lottery sector isn’t hoping to turn a 7/11 into a full blown sports betting outlet!”

Parlay versus single event wagering

Weil also drew an interesting comparison between parlay style bets available via lottery and single event wagering. He cited Delaware, which has been selling parlay sports betting through its lottery network as a prime example. “Parlay and single bets are working equally well in that state,” he said. “But where the hold for operators in head-to-head sports betting is small – single digit – the hold in a parlay type sports product is in the upper double digits.”

He continued: “In Delaware after Super Bowl they were able to offer both styles of wagering, whereas last year only parlay was allowed. The parlay type bets from last year to this year were largely unchanged in terms of handle. But when they compared the revenue back to the state between the two, the parlay bet was almost double the number. My point is that there’s more money to be made on lottery style sports betting than traditional. But they can sit alongside each other. There’s room in any given state for full on sports betting, but there’s also a place for lottery style betting.”

Wearing his moderator’s hat for next week’s Betting on Sport America event, Weil hopes for a more convivial approach between different sectors to doing business. “Gaming people in most jurisdictions tend to be more adversarial and the industry needs to change that and come together,” he advised.

Industry must work together

“One of the most difficult things is to get legislation to change. And when you have different interest groups fighting among themselves over multiple bills with different supporting governors, legislators tend to back off to the point where they won’t pass a bill. On the other hand where the gaming industry can come together and make a proposal that benefits everyone they get a bill passed.”

He concluded: “The message I’d like to get across is that collaboration can work and it does work, as we have seen with lotteries and gaming. When I started with online lottery we had a lot of pushback from convenience stores who said if you start selling online it will put them out of business. The outcome has been the opposite. We’ve seen no cannibalization of lottery spend and actually we’re reaching out to a whole different demographic. The same thing is true with sports betting – there is room for everybody. I’d love to be able to see every state sell all these products and I’m confident that the states will find a way to figure it out.”

Betting on Sports America boasts 175 leading industry speakers across 40 sessions, with 60 exhibitors displaying their latest products on the 61,000 sq ft exhibition floor at the Meadowlands Exposition Center. Delegates will be treated to world class hospitality with plenty of business and networking opportunities in New Jersey (Meadowlands Racetrack) and New York (40/40 Club and Sky Room Rooftop Bar). For more information about the event, please visit the Betting on Sports America website.  

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