The lottery sector worldwide is undergoing a time of significant change, as long-held gambling monopolies are challenged by incoming regulated and private actors. Although a worldwide phenomenon, this has been most prevalent in Europe.
In the opening episode of iGaming Daily this week, SBC Media’s Content Director, Ted Menmuir and Senior Journalist, Ted Orme-Claye – generally known as ‘The Two Teds’, ‘Tedward’ or ‘Big’ and ‘Little Ted’, depending on the prevailing mood of the time – offered their views on these developments.
Although a huge global sector with massive turnover, lottery is a largely an ‘ever present market’, Menmuir observed – but one which is subject to little change. Lottery contracts are long-lasting and commercial processes are arduous, and so movement is slow.
So what is driving these sudden changes? Menmuir explained: “Governments are going through a general revenue of various gambling laws, and intertwined in that is the debate around the position of the lottery as a product they have a political mandate for good causes, and is that being done effectively by the operators?
“ There’s also internal changes to the market within itself, what we’ve seen from the supplier side and technology side is that we used to have these gigantic tech goliaths – IGT, Intralot, Scientific Games – and they’ve all revised their products.
“They’ve gone and started to sell off units or they’re refocusing on their core product of the lottery. Lottery is a very lucrative business, however, what we’ve seen in the past 10 years is that it’s not good at integrating new products.
“From an investor perspective, they’ve revised what is the purpose of a lottery company? How can it be perfected to the modern consumer? What is the preposition – is it just a lottery or can it compete in other fields?”
The contracts governments hand out to private lottery operators are, as both Teds noted, long running. At a minimum, agreements usually stand for at least 10 years, in some cases even longer.
In the UK, a notable change to this trend was witnessed, as Allwyn supplanted Camelot as operator of the National Lottery. When the firm assumed licence duties in February 1994, it ended Camelot’s three decade reign as sole operator.
“That’s what is so seismic about this change,” Orme-Claye said. “This company which has been set up to manage the lottery, which has done for three decades, is now being phased out in favour of a multinational company which is active across various other European lottery markets.”
The forthcoming takeover of the National Lottery by Allwyn is the ‘million dollar question’, Menmuir asserted, and could be an indicator of the direction the rest of the European sector could take.
Allwyn is of course not the only firm making moves, however, as Groupe FDJ and Flutter Entertainment have been making noise of late – the former acquiring ZETurf and Premier Lotteries Ireland (PGI), and the latter taking its Sisal holding live in Turkey and Morocco.
These developments and more were covered by the team on iGaming Daily – to stay tuned to more operators, check out the SBC YouTube channel or iGaming Daily Spotify page.