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May/June 2016 // PUBLIC GAMING INTERNATIONAL //
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expanding the portfolio of games and price-
points. Some states now have $50 instant
tickets. The instant ticket category has an
incredibly wide variety of play-styles and
price-points to appeal to all types of players.
The draw-based games have not been
growing nearly as much as instant ticket
sales over the past 20 years. We believe
that one reason for that is simply the lack
of variety, lack of price-point and value-
proposition options for the consumer.
Mega Millions and Powerball provide a
player experience that is quite similar and
they offer just two price points - $1 and $2
tickets. We would like to create a platform
for expanding the portfolio of draw-based
games, and give the consumer the option
to buy higher-priced tickets, perhaps with
different value propositions. We feel there
is a market for those options and would
like to give the consumer those choices. To
do that, we need the scale and liquidity of a
nationwide population base.
Getting the broad consensus for doing a
nationwide game is challenging. If a game
can be done on a regional basis, it should
be done on a regional basis because it is
easier for three or four or five or even ten
state lotteries to agree on a game’s param-
eters than it is for forty four lotteries to
agree on everything. Regional games pro-
vide a fabulous platform for games that are
hard to implement by an individual state
lottery. Likewise, there are games that will
perform much better if we can get an even
larger number of lotteries to collaborate
and implement them.
Does the national premium game have to be a
draw-based game?
R. Hargrove:
It doesn’t necessarily have
to be a draw-based game but it has to be
a value proposition that the player is will-
ing to pay a higher ticket price for. The first
thing I say at every national premium game
meeting is there’s no point in doing it to-
gether if we can do it alone. And there’s no
point in doing it with forty four states if it
can be done with six states. Instant games
do not require the high population base that
draw-games depend on. And it is important
that we figure out how to drive growth in
the draw-based games because they deliver
higher profit margins than instants tickets.
Why not just scale up the regional games and
expand, adding states and building liquidity
along the way?
R. Hargrove:
Regional games can scale
up as you suggest. For example, a number
of state lotteries now offer the Lucky for
Life game, which has a 60% prize payout.
New York can’t do a 60% payout. It wanted
to do the same kind of a game, but with a
55% payout. So New York and New Jersey
created Cash4Life, which pays out 55%.
Those states that like the game and can
pay out 60% joined the Lucky for Life re-
gional game. And those states that want a
55% game joined Cash4Life. Both are great
games. But neither could scale up to nation-
al scale because some states prefer a 60%
payout while others want a 55% payout.
And since they both work well on a regional
basis, why not run both games and just al-
low each state to choose which one works
best for them and their state regulations?
It is not an either/or question. Regional
games are great. We just want to explore
all possibilities for expanding the port-
folio of multi-state games. And there are
some game concepts that work better with
maximum liquidity and participation of
the largest number of state lotteries.
The World Lottery Association (WLA) plays
such an important role on the global stage of
government lotteries. Why should U.S. lotter-
ies become more involved in the WLA?
R. Hargrove:
I think it’s important for
all lotteries to be part of the global com-
munity because there’s so much we can
learn from each other. That is particularly
true for U.S. lotteries, which are less ma-
ture than many other lotteries around the
world. And the responsible gaming plat-
forms that have been developed by WLA
are more important than ever now that lot-
teries are moving into internet wagering.
U.S. lotteries learn from each other and
from the analyses of game performance in
different states. By the same token, we could
benefit immensely by studying the experi-
ences of lotteries in Europe, Australia, South
America, and other markets around the
world. That would expose us to a much big-
ger variety of new games than we see in the
U.S. That is also true for multi-jurisdictional
games where regions are making them work
across completely different gaming cultures,
monetary systems, and languages. Some of
these lotteries have been operating for over
200 years. And South and Latin America are
advancing in Mobile and Social gaming in
ways that everyone can learn from. There is
practically no issue that we face in the U.S.
that has not been dealt with by other lotter-
ies around the world.
Many parts of the Asian-Pacific region,
China and Korea, are in the early stages of
developing their own lotteries and regula-
tory models. As the games-of-chance in-
dustry becomes global, it is important the
U.S. join with other lotteries to shape the
global industry in ways that will serve the
interests of governments and good causes.
Sports betting has been on the global
stage for many years. And now Daily Fan-
tasy Sports has put it on the radar of every-
one in the U.S. games-of-chance industry.
The WLA Global Lottery Monitoring Sys-
tem (GLMS) is tracking the issue of pre-
serving integrity in sports betting from the
only angle that works—engaging the entire
international community of regulators and
operators. It’s a fabulous program put to-
gether by WLA president Jean-Luc Moner-
Banet and others, and I certainly applaud
their efforts.
The WLA recently held an iLottery sem-
inar in New York that was very well attend-
ed and everyone thought it was fabulous.
The presenters were from lotteries that
have been selling lottery products online
for many years. There is a lot we can learn
from them. WLA seminars are conducted
all over the world and always receive rave
reviews from the participants.
So, yes, let’s engage with our colleagues
in the global community of government-
lottery operators. The WLA is the perfect
vehicle to connect us to our colleagues all
around the world!
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