Eye on Europe - May 23, 2006

23 May 2006

SZDSZ & MSZP Pro Privy -- The Hungarian Liberal Party (SZDSZ ) wants to privatize the country's national lottery, Szerencsejatek Zrt. Gábor Kuncze, the chairman of this junior coalition party, is strongly in favor of market-based solutions to public services and cutting taxes (good liberals should do that), and he has put together a shortlist of the privatizations that includes the lottery. The SZDSZ is working with the Hungarian Socialist Party (MSZP) toward forming a coalition in favor of privatization. The Hungarian Civic Union (the conservative and Christian Democratic Party) would oppose such a movement, however, and has claimed already that this gaming privatization is unacceptable because the Hungarian National Lottery brings so much money to the state and beneficiaries. Of course, it could very well be that a privatization would generate, on short and long term, much more money. Did they think of that as well? And how do they know how much money the make? The last two annual financial reports have not yet been approved.

WC Betting -- Also in Hungary, Szerencsejatek Zrt. Estimates that between US$5 million and $7 million extra turnover from bets on World Soccer matches will be generated in June. The national Hungarian team, by the way, did not qualify. Two years ago, when the European Football Championship, were played, Szerencsejatek Rt. bets doubled to 300,000. The Hungarian squad did not qualify then either. Business daily Vilaggazdasag calculated that the extra World Cup betting in Hungary will be over $15 million. Hungary has nearly 10 million inhabitants.

RTL TV Betting Shows -- German TV viewers will soon be able to participate in TV betting shows. One may bet on "who will become a millionaire," or on "who becomes the new 'superstar.'" Sports betting will be an essential part of the bouquet of betting products as well. RTL, the leading European RTV group (with 34 TV channels and 34 radio stations in 11 countries and a global player in sports content), is convinced that state-controlled sports betting operators have to open up the sports betting market. This is a consequence of the verdict of the Federal Constitutional Court, which states that sports betting has to be re-regulated before Dec. 31, 2007. RTL foresees a liberal betting entourage, which it believes will be copied in other European countries. RTL Interactive is already operating in the sports betting arena with its own subsidiary, Gambelino, on the Internet. Above that, RTL has established a joint venture with the Austrian betting operator Starbet (of which RTL Interactive holds 30 percent).

Betandlose? -- An anonymous gamer in Salzburg (Austria) has resumed his court case versus Betandwin. Based on new legal opinions, the player is claiming that the sports betting operator is working illegally. The unknown person was stopped in July 2005 by the Vienna public prosecutor's office. Now the gamer has found the support of university professor Herbert Wegscheider from Linz, who holds the opinion that betandwin.com and/or BAW International are violating Austrian criminal law by offering sports betting, casino games and lotteries via its Internet platform in Austria, where Betandwin has no licenses. To be continued . . .

Rob van der Gaast has a background in sports journalism. He worked for over seven years as the head of sports for Dutch National Radio and has developed new concepts for the TV and the gambling industry. Now he operates from Istanbul as an independent gambling research analyst. He specializes in European gambling matters and in privatizations of gambling operators. Rob has contributed to IGN since Jul 09, 2001.