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States Eyeing Online Lottery for Revenue

10 June 2011 by admin

So given the current state of online gambling and online casinos in the United States right now, we here at are thinking that online gambling regulation is not going to happen in the very future. We hope that things move forward, that players and pro-online gambling lawmakers will continue to fight for an activity that Americans overall want.

In the meantime, states still need to find more revenue to meet their budget needs. Since online gambling has been made a stickier situation to get into for the time being thanks to the Department of Justice, state lawmakers looking for other online gambling alternatives. The interest and the want to play gamble online is there in the American people, but a way around the sticky tar pit that the DoJ has created must be found.

And it looks like a way has surfaced. Understand that this is not a brand new idea. Some states have been doing this for around six months or a little more already. I am talking about online lottery sales. Minnesota started offering subscriptions for their state lottery online back on November 18th. Since then they have sold close to 9,000 year subscriptions which has generated $333,476 in revenue.

Following on their heels is New Jersey, who cannot seem to help themselves when it comes to trying to establish some form of online gambling. Their bill for online lottery sales has passed in as Assembly committee, but still has yet to be heard in the full Assembly much less be voted on. Also there is no word from Governor Chris Christie what his stance on online lottery sales is.

The draw of selling online lottery subscriptions is that those sales can increase a state’s revenue by around 15% within a five year time span, according to Edwin McGuinn, the CEO of eLottery of Stamford, Connecticut. He also says that online lottery sales could draw in “a demographic who doesn’t traditionally go into a convenience store to buy a ticket.” Naturally that has owners of convenience stores worried about money being taken away from small business owners. To try to compensate for the loss, the New Jersey bill is willing to give the owners of convenience stores a 5% cut of the profits from online lottery sales, but those owners say it is not enough as it is not just a loss of revenue from the lotto tickets, but from the impulse buy items, such as coffee, that lottery customers grab when coming in to buy a ticket.

While it is unfortunate for small business owners, the prospect to generate more revenue is sound. Great Britain and Finland have seen an increase in revenue from the sale of online lottery subscriptions: 15% and 25% respectively. So this could well be another reason to treat another aspect of online gambling like the Finnish do.

In the meantime we will see how far New Jersey’s bill for online lottery sales goes. In total there are 43 of the 50 states who offer their residents a lottery. Given the current state of online gambling in the US—thanks again, DoJ—online lottery sales may be the way to go for states in the short run.

One Response to “States Eyeing Online Lottery for Revenue”

  1. Gregory Dooner says:

    Studies show the implementation of incorporating advertising on the reverse side of the pre-printed lottery ticket stock will result in an as yet untapped revenue stream. Advertising on the reverse side of the pre-printed lottery ticket proposal is not new. In 2008 the New Jersey legislature were exploring different methods of generating additional revenue to offset the New Jersey State budget deficit? One of the methods that were approached was on-line lottery ticket advertising and as quoted by former Senate President Mr. Richard Codey to the Associated Press was “Codey also wants to explore allowing advertising on the backs of lottery tickets”. The time has come to utilize as yet untapped revenue streams. The State of New Jersey is in dire straits and is now looking into alternate forms of Generating additional revenue streams. Governor Christie is on the right path perhaps now we will see NJ seeking other alternate revenue generating systems without raising taxes.