I-Lottery Update - October 2007

3 October 2007

Lotterywest Extends Contract with Gtech

Gtech Corporation has announced that Lotteries Commission of Western Australia (Lotterywest) has extended its online lottery contract with the U.S.-based lottery solutions provider for an additional one-year period ending March 2009.

Gtech has provided lottery products and services to Lotterywest since 1986.

Greek Court Rejects Gtech's Appeal

The Athens Court of First Instance on Sept. 27 rejected U.S.-based Gtech's injunction appeal against Greek lottery operator OPAP's IT and terminals contract with Intralot. Gtech claimed that OPAP had breached both Greek and EU law by canceling the public tender in which it was bidding alongside Intralot and Scientific Games, and awarded it directly to Intralot.

The 95 million euro contract involves the technical support provided by the corporation and its betting agents for three years.

Spanish Inquisition

Spanish tax authorities have opened an investigation into foreign gaming operators that have allegedly failed to pay taxes covered under Spanish law. Spanish lottery operator ONCE has allegedly submitted evidence demonstrating that the unnamed companies have failed to contribute IVA (value added tax) and IRPF (tax on employees). Reports did not specify which services and operators were under investigation.

SA Lottery Returns

After a six-month hiatus, the South African National Lottery is up and running with Intralot subsidiary and black power consortium Gidani at the helm.

Last year, the license was awarded to Gidani but in March the Pretoria High Court overruled the Ministry of Trade and Industry's decision after finding that the National Lotteries Board had not exhaustively investigated the shareholding structures of Gidani and former National Lottery operator Uthingo.

According to South African media reports, Uthingo and Gidani, by allegedly allowing political office-bearers to hold financial interest in them, did not satisfy a provision in the country's Lotteries Act that expressly prohibits National Lottery bidders from doing so.

Trade and Industry Minister Mandisi Mphalwa, who said in May that the lottery would "soon be running again," did not specify the date on which the lottery would be reintroduced. "We are currently processing the responses we have received from the National Lottery Board," he said.

But, according to a press release on the lottery's Web site, the first draw will take place on Oct 13.

Polish Lottery Monopolist Shut Down

According to the Polish News Bulletin, Polski Monopol Loteryjny's (PML) management, in conjunction with the country's Treasury Ministry, has elected to shut down the 70 year-old lottery monopoly. Treasury has appointed PML President Rafal Wiatr as liquidator, the report said, adding that the company had signed an expansion-focused deal with Intralot. The decision was not unexpected, the Bulletin said, as PML "has a weak position on the market." In 2006, Treasury reportedly filed a motion for PML's bankruptcy due to insolvency. Wiatr did not comment on the Intralot deal.

PhilWeb Offers New Text-Based Lottery Game

Philippines-based online game developer and telephone services provider PhilWeb Corp. announced that it will offer a new text-based lottery game to subscribers of its mobile phone service, Smart Communications. The game, called TXTINGO 9, enables subscribers to text nine numbers between one and 40 to 4646. The sender of any set of nine numbers that match in any order a set of nine numbers randomly picked by a computer every day at noon wins a cash prize of at least $134,296.

OzLotteries.com, Yahoo7 Partner Up

OzLotteries.com, a division of Australian e-commerce company Jumbo Corporation Limited, announced it has signed an exclusive alliance agreement with Australia's main search engine, Yahoo7. OzLotteries will operate the lottery site for Yahoo 7 Lotto, which is set to launch on Oct. 1, enabling Australian customers to buy tickets and access draw information and results online.

Veikkaus Releases Half-Yearly Results

Finnish state-owned operator Veikkaus released half-yearly results, which show turnover up 3.2 percent to 682.7 million euros and revenue up 8.3 percent to 207.6 million euros. The company said its most "eager players" hail from central Finland, and its Lotto game was most popular among all players (42 euros per capita), followed closely by its keno offering (26 euros per capita). Veikkaus added that it would contribute an estimated 419 million euros to the Finnish Ministry of Education during FY 2008.

PacificNet Acquires 51 Percent Stake in Guangdong Poly

PacificNet's (PacNet) China-based subsidiaries have agreed to acquire a 51 percent stake in e-lottery services provider Guangdong Poly Blue Express Communications (Guangdong Poly). PacNet said it expects the acquisition of the China Welfare Lottery Center-approved group to "be accretive to 2008 earnings." Financial details of the deal were not disclosed.

Florida Lottery Could Privatize

Florida Gov. Charlie Crist is reportedly considering leasing or selling the Florida State Lottery to a private vendor for "billions in cash." Crist was quoted in the Associated Press as saying that privatizing the lottery could "help solve Florida's financial dilemma," but cautioned that the sale is "merely an idea" and that "it's not something [he's] promoting."