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// PUBLIC GAMING INTERNATIONAL // September/October 2016
similar. I would propose that we need to work together to develop
solutions and strategies for the global community of government-
gaming operators to defend the interests of their stakeholders.
Jean-Luc Moner-Banet talked about these broader issues yester-
day. It might seem that the step from DFS to a market-place being
disrupted by an invasion of highly sophisticated and well-funded
operators based outside of the U.S. and selling all varieties of prod-
ucts, many of which replicate the lottery-playing experience, is a
big leap and not likely to happen anytime soon in the U.S. It’s not
a big leap. That is exactly what happened in Europe and, I would
submit, can happen anywhere including the U.S. It does not take
long for a small crack in the dam to cause the whole dam to crash
under the weight of powerful forces. We owe it to our stakeholders
to make sure our businesses are prepared.
Gordon Medenica:
Let’s get the Canadian perspective from
Lynne …
Lynne Roiter:
First, I would suggest that a new game concept
that goes from zero to $4 billion in sales in the time that Fantasy
Sports has done should not be regarded as insignificant. Granted,
that may be just 6% of U.S. lottery sales, but it is still huge, it
shows a potential for continued growth, it attracts the young adult
demographic, and it reflects a shift in consumer play styles and
preferences. I think Fantasy Sports represents a potential for major
impact on the games-of-chance industry.
Second, like Europe, sports-betting is very popular in Canada.
But so is Fantasy Sports betting. That may be partly because Canada
is heavily influenced by whatever is popular in the States. But I have
another theory. The University of Montreal looked at how people
develop habits and behavioral patterns. They found that if smoking
and drinking is not habitual prior to an early age, like late teens, it
is highly unlikely that the person will develop a problem later in
life. That could be relevant to the Lottery industry if we think that
it doesn’t matter if people play the DFS instead of lottery in their
twenties because they have always started in with lottery in their
thirties anyway. It may not have mattered so much in years past
when twenty-somethings were not exposed to so many gaming op-
tions. Insofar as recreational gaming options like Fantasy Sports are
attracting a younger audience, those consumers develop habits and
behavioral patterns that may be difficult for Lottery to connect with.
Are we hoping that twenty-somethings who play Fantasy Sports are
going to migrate over to Lottery when they move into their thirties?
New games may not affect us so much in the short term, but we
should also think about the long-term potential impacts.
Gordon Medenica:
Maybe a silver lining is that DFS is played
over the internet. If legislators are considering the legalization of
DFS, maybe they will be more receptive to the prospect of enabling
U.S. lotteries to sell online. DFS could be the thin edge of the
wedge that causes legislators to allow lotteries to offer games on the
internet. James …
James Maida:
Commercial operators are always pushing the
edge of the envelope. Where there is a gray area, they can move
forward and adjust course based on the reaction of the market-place
and the legal system. If their actions are challenged by the courts,
like DFS has been, it’s easier to ask for forgiveness than permission.
And that method has served them well. By the time legislators get
around to addressing the issues, they are dealing with a fait ac-
compli which is much more difficult to unwind. Of course, lottery
directors can’t apply those methods without unwanted controversy.
But it is important to recognize how these changes unfold; and to
think about how lotteries might defend against it. At this point, for
instance, after decades of pushing by commercial operators to open
up the markets, European lawmakers must make policy decisions
based not just on what is best public and regulatory policy, but
what is the reality of the market-place. If the reality is that the un-
derground market is so big that it is no longer practical to pretend
Continued on page 67It is conservatively estimated that illegal
sports-betting exceeds $100 billion a
year, that 97 percent of the $4.1 billion
bet on last year’s Super bowl was illegal,
and that millions of otherwise law-
abiding citizens are betting on sports in
the U.S. in spite of the illegality. At what
point does it become impractical to
continue to outlaw it?
—James Maida
Commercial operators are always
pushing the edge of the envelope.
Where there is a gray area, they can move
forward and adjust course based on the
reaction of the market-place and the legal
system. If their actions are challenged by
the courts, like DFS has been, it’s easier
to ask for forgiveness than permission.
And that method has served them well.
—James Maida
Panel Discussion