England's 'Chariotlottery' Rolls into Town

12 September 2004

A group of British entrepreneurs are preparing to launch an Internet lottery offering better odds than what's offered by the U.K. National Lottery. The new lottery, called "Chariotlottery," will also allow players to choose which charity their purchases will benefit.

Thirty percent of each purchase will go to the player's choice of participating charities--an option not available through the National Lottery. But that's not the only thing that sets the new lottery apart from the National Lottery; its creators say players' chances of winning are 21 times better.

Initially, five lotteries will be held per week, and each of them will benefit a different charity. Players can choose to play in any or all of the lotteries offered each week. Drawings for all five lotteries will be held every Friday, and each charity will appear as a lottery beneficiary five times a year. Fifty-two charities have signed on as partners.

Chariotlottery will launch as an Internet-only lottery because Camelot, the operator of the National Lottery, holds a monopoly on ticket-based lotteries in the United Kingdom. Chariotlottery is also classified as a different sort of lottery than the National Lottery. As a society lottery governed by the Gaming Board of Great Britain, Chariotlottery will also have to adhere to different rules than the National Lottery, but the new rules benefit the lottery in many ways.

The maximum number of participants in each of the five weekly lotteries will be limited to 2 million. Tickets for each of the five lotteries will sell for £1 each, with 30 pence for every pound going to charity. The maximum jackpot for each lottery will be £200,000.

While the jackpots for Chariotlottery will be considerably less than those of the National Lottery, the odds of winning will be considerably better because society lottery rules prohibit jackpots from rolling over. Therefore, Chariotlottery must declare at least one winner for each lottery drawing. If no player has correctly picked all six of the winning numbers, the player who comes closest to picking all of the numbers will be declared winner. Thus, it's possible for someone to win by correctly guessing only four or five numbers.

One single set of numbers will be drawn each week, and that set will be the winning set for all five of the weekly drawings. So, if a player were to pick all six correct numbers, he would win in every lottery in which he played. If he paid £5 to play in all five of the weekly lotteries then he would win across all of them and receive a £1 million jackpot. But if he played in only one, then he would win £200,000.

Chariotlottery hopes that offering better odds and enabling players to choose which charities their play will benefit will help it achieve success.

Craig Freeman, Chariotlottery's managing director, pointed out that many National Lottery players are aggravated with the double-edged sword of a rollover weekend. He believes a lot of players would like to see more small winners instead of one massive winner.

"You tend to get a lot more players who play for that particular weekend, but the converse side of the coin is that some players become a bit annoyed that the jackpot keeps increasing and increasing but is won by only one or two people," Freeman said. "A society lottery distributes winnings across a much larger proportion of the public by not creating such huge payouts. The average payout for the National Lottery is about £2.3 million and the average payout for Chariotlottery is going to be about a million pounds. So there is a little difference between major jackpots, but it will never have no winner for a period of two or three weeks."

Freeman cited a white paper published last August and commissioned by the Department of Culture Media Sport to explaining why so many people have stopped playing the National Lottery. Low chances of winning were one of the main reasons. The other was dissatisfaction with how funds are allocated.

National Lottery money has recently been used to fund a £628 million grant to the failed Millennium Dome in London, and £270,000 was allocated to help farmers in Peru breed larger guinea pigs, while World War II veterans and medical charities received little funding.

Chariotlottery has been in development for a little over a year and a launch is anticipated before the end of 2004. As of late August, the company was still looking for partners in the gambling industry and hoping to raise an additional £3 million to fund a high-profile launch campaign that will be necessary to compete with the National Lottery.

Freeman also said that Chariotlottery anticipates expanding to mobile and iTV systems in the future and that if demand were to exceed 10 million players per week, the group would open more additional weekly lotteries, thereby fulfilling the limit requirement of 2 million participants per lottery.

The National Lottery, meanwhile, isn't considering Chariotlottery a threat.

"We are not afraid of competition," a spokesman for the National Lottery said. "The U.K. lottery has raised over £15.8 billion for causes since 1994. Indeed, we would be happy to compare sales figures and returns to charity after one full operating period."

Bradley Vallerius

Articles by Bradley P. Vallerius, JD manages For the Bettor Good, a comprehensive resource for information related to Internet gaming policy in the U.S. federal and state governments. For the Bettor Good provides official government documents, jurisdiction updates, policy analysis, and many other helpful research materials. Bradley has been researching and writing about the business and law of internet gaming since 2003. His work has covered all aspects of the industry, including technology, finance, advertising, taxation, poker, betting exchanges, and laws and regulations around the world.

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