Paul’s Wall May 23

The important thing is that differences of opinions not impede action and the need to always move forward.

Ana Paula Barros, Santa Casa da Misericórdia de Lisboa / Jogos Santa Casa

The European experience illustrates just how important it is to work together to achieve common goals.   European lotteries were and are under tremendous pressure to work together in the defense of lottery stakeholders.  An area where the potential to collaborate can yield huge benefits but also entails formidable obstacles is regulation.  The advent of cross-border betting introduced by the internet has created regulatory challenges that urgently need to be addressed.  Ultimately, there will need to be an international cooperation to develop the means to enforce the laws of each jurisdiction.  Forward-looking regulators are already working to make that happen.  For instance, the French regulator ARJEL and Italian regulator AAMS are exploring ways to work together.  The challenge, of course, is that regulations and gaming policies differ from one jurisdiction to another.  And in Europe, you need to factor in the rules of the European Union Commission regarding commerce, free-trade, and open borders.  Fortunately, that does not prevent the progressive leaders of this business from leveraging the power of collaborative action while respecting the differences of jurisdictional laws and objectives.

An example of what they are contending with in Europe is found in the news item about the disputes over tax rates to be charged the i-gaming operators in France.  To quote article titled ‘ARJEL Pushes for French Gaming Reforms', the opening up of the market included “the introduction of a 7.5% tax on online (internet) betting and 2% tax on poker. Many operators are now complaining that such rates are prohibitively high and are obstructing the development of competitive activity within the country.”   Europe has tax rates and regulatory rules that differ from one country to the next.  For instance, Spain is implementing a higher rate and the mechanisms to enforce their regulatory framework and tax laws are being implemented right now.  The challenge for Lotteries in Europe is to prevent the trend towards lower and lower tax rates from completely upending the stability of an industry that produces billions of euros for Good Causes. U.S. lotteries may feel somewhat protected for the time being.  But even in the U.S., the industry leaders do see the need for progressive action to consolidate their market position and defend the interests of their stakeholders. 

An example of what we are contending with in the U.S. is just a shocking lack of understanding.  For example, a security “expert” from Unysis is receiving widespread press for ridiculous scare-tactics when it comes to the enforceability of i-gaming regulation.  To wit, “The difficulty of limiting access based on geography is that it’s nearly impossible, and addressing the issue of smart-phones and tablets users will add to the complexity.”  The evidence that this is simply wrong is that limiting access based on geography has been effectively performed for many years throughout the world; with little or no incidence of failure as far as I know.  Likewise age verification.  It is so unfortunate that this gross misinformation is being used to create anxiety over the push to regulate the i-gaming markets in an intelligent way that protects the players and channels the economic benefits back to the public.   

I know this is a recurring theme in my blogs, but the need for working together is more pressing than ever.  European lotteries recognized this a decade ago and began the process then.  It’s not just about collective action to prevent private offshore i-gaming operators or Nevada casinos from walking off with the U.S. market, or defending the interests of lottery stakeholders in all manner of regulatory and public policy issues, or enabling national chain stores to vend lottery products, or raising the price of PowerBall to $2, or creating the international mechanisms to enforce the laws of each jurisdiction and protect the integrity of the games, or forging a nationalized approach to branding, advertising, or at least PR - it’s about all that and so much more.  It’s about having the vision to embrace the opportunities resident in the collective power of lotteries working together.  And it’s about countering the short-sighted notion that if lotteries don’t agree on something, that’s OK because in the end lotteries all operate within the borders of their own jurisdiction, can decide and act independently from each other, and so therefore there is no compelling need to overcome differences.  A failure to overcome the obstacles to collaboration and push hard to accelerate the timelines for implementing multi-jurisdictional agendas and initiatives, will result in a diminished return for the Good Causes supported by each individual lottery.  Lottery stakeholders and beneficiaries deserve better than that.  The tremendous success of the multi-jurisdictional jackpot games are a good example of what can be accomplished by working together.  But that should be just the beginning. The most critical element of this issue is that time is not on our side.  The world is rapidly changing all around us.  Markets are changing, customer needs are changing, gaming options are expanding, and the ingenuity of competitors that are rushing to meet the needs of this dynamic marketplace is boundless.  As my friend Ana Paula Barros of the Portuguese Lottery says, “The important thing is that differences of opinions not impede action and the need to always move forward.”

The above, of course, are just my own thoughts on these issues and I very much respect the fact that there are other views on these issues.  Indeed, I am solicitous of those views and endeavor to give a voice to all perspectives.  It is my hope that the course of all of us “putting it out there” will stimulate the dialogue needed to power through differences and unlock the incredible potential for government-sponsored gaming to absolutely dominate this industry.   

Lottery Expo (Loews Miami Beach Hotel on September 20 to 22) is shaping up to be a great event.  Registration for Lottery personnel is free.  The great rate of $199 is a very special and limited rate so don’t wait click here to reserve your room today. The conference agenda will be posted very shortly at www.PublicGaming.org.  So please mark your calendars.   Thank you all for your input and support.  We very much appreciate it and are dedicated to working hard to earn it.  Please feel free to e-mail me at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .