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Introduction
Play you favourite games online
Play your favourite games online.
Presented by: Maurice Richard
1
Brief
Lottery History
2
Book of Numbers
26:52 And the LORD spoke unto
Moses, saying,
26:53 Unto these the land shall be
divided for an inheritance according to
the number of names.
26:54 To many thou shalt give the
more inheritance, and to few thou shalt
give the less inheritance: to every one
shall his inheritance be given according
to those that were numbered of him.
26:55 Notwithstanding the land shall be
divided by lot: according to the names
of the tribes of their fathers they shall
inherit.
26:56 According to the lot shall the
possession thereof be divided between
many and few.
3
The Great Wall of China Was Financed
by Funds Raised by Lotteries
4
Augustus Caesar – conducted the first
known public lottery for a community
cause, raising funds for repair work in the
city of Rome.
5
Loterie Nationale - Helped Finance
Napoleon Bonaparte’s Imperial Project
and Wars.
6
1530 - La Lotto de Firenza became the first public
lottery in Italy, soon followed by similar drawings
in Genoa and Venice.
7
1567: Queen Elizabeth I establishes the first
English state lottery. Prizes include cash,
plates, and tapestry, with 400,000 tickets
offered for sale.
List of winners from the English
lottery of February, 1569
8
French lottery drawing in the 1780s
1759: At the urging of Casanova, Louis XV founded
the Loterie Royale of the Military School in France.
With the advent of this lottery, other lotteries were
outlawed and the funds were to be used to reduce
the State's debts. The King thus created a
monopoly, which became the forerunner of the
Loterie Nationale.
9
1768: George Washington operated a lottery
to finance construction of the Mountain Road,
which opened westward expansion
from Virginia.
10Benjamin Franklin used lotteries to
finance cannons for the Revolutionary War.
111765: John Hancock operated a lottery
to rebuild historic Faneuil Hall in Boston
12Thomas Jefferson was a strong
advocate for early lotteries.
To quote Mr. Jefferson,
"A lottery is a salutary
instrument and a tax ...
laid on the willing only,
that is to say, on those
who can risk the price of
a ticket without sensible
injury, for the possibility
of a higher prize."
131790 due to the Civil War: Fifty colleges, 300 schools
and 200 churches were erected with lottery proceeds.
Most notably, universities such as Harvard, Yale,
Princeton and Columbia were funded by lotteries.
14PROHIBITION
1878: All states except Louisiana prohibit
lotteries, either by statute or in their constitution.
1905: The U.S. Supreme Court reaffirmed
the states' use of police powers to control
gambling, effectively ending the Louisiana
Lottery and other gambling in the U.S. No state
was directly involved in the operation of a
gambling enterprise, and lotteries were
prohibited in by constitutional provisions for the
next 60 years.
15The IRISH Sweepstakes
1930: Irish
Sweepstakes
were launched
with great
success in the
American and
Canadian
markets
because of the
abolition of
lotteries in
these countries.
16Lou Smith (l) of Rockingham Park racetrack sells
the first New Hampshire Sweepstakes ticket to
Governor John W. King on March 12, 1964
New
Hampshire
first
followed by
New York
and New
Jersey
171969: The Société d’exploitation des loteries
et courses du Québec (Loto-Québec) becomes
Canada’s first lottery corporation, and North
America’s third.
181972: The Canadian Parliament authorizes the
Canada Olympic Lottery, which becomes Loto-
Canada in 1976. The Federal Government
thereby becomes a direct competitor of the
provinces.
19“Prohibition?
Ha! They tried that
in the movies and
it didn’t work.”
Homer Simpson
20Oh Canada!
Legal
Matters
21THE LEGALITY OF
INTERNET GAMING IN CANADA
Criminal Prohibitions Against
Gambling in Canada
Part VII of the Canadian Criminal Code makes all
activities related to operating or acting in
support of a commercial betting enterprise an
offence, unless it is an enterprise licensed by
a Provincial government.
Section 201 makes it an offence to keep a
common gaming house or a common betting
house, or to be found in such a place.
22THE LEGALITY OF
INTERNET GAMING IN CANADA
Criminal Prohibitions
Section 202(1) creates offences re betting (waging
stakes on external events); Section 206 creates
offences re lotteries or gaming (waging stakes on
one’s own competitive activity).
Although these provisions were enacted to deal
with “bricks & mortar” gambling operations, they
may be applied to enterprises that offer casino-
style games or sports-books over the Internet.
www.baccarat42.com/ free-online-casino-game/ca... 23Exceptions to Prohibition in Canada
Government-Operated
Computer Gaming
Internet gaming (a “lottery scheme…operated
on or through a computer”) may only be
conducted by Provincial governments.
207(1)(a) and (b) and 207(4) of the Code
A Provincial Government may conduct and
manage a lottery scheme on or through a
computer, but may not license others to do
so. Subsection 207(4)
In Canada, only Provincial Governments can
offer gaming over the Internet.
24Exceptions to Prohibition in Canada
“Private Bets”
Not an offence to have “a private bet between
individuals not engaged in any way in the
business of betting”
Section 204(1)(b) –sections 201 and 202 (i.e. “betting”)
25Internet & Criminal Jurisdiction
Advertising Internet Betting
Some Canadian media advertise offshore-
based Internet betting to Canadian
residents.
– ads in print, radio, signs at sporting events
Advertising or otherwise giving notice of
“any offer, invitation or inducement” to
bet on the results of contests is
forbidden. 202(1)(h) of the Code
– applicable to ads for interactive sports-books
26Internet & Criminal Jurisdiction
Advertising Internet Betting
Much of the advertising of Internet
gaming that goes on in Canada is
subject to prosecution.
However, no one has
been prosecuted for
this activity.
Prosecutions could
occur in the future.
www.roxyaffiliates.com/.../ images/kanawake.gif 27Interesting Observation
Sports Book and
Advertising Internet Betting
October 12, 2004: Bowman International Sports
Ltd., an Internet betting and gaming site which
has been advertising in Canada for years,
announced an advertising deal with the
Canadian Football League.
Comprehensive in-stadium advertising
program throughout CFL post-season &
cross-promotional free game offered on CFL
and Bowman’s websites.
28http://www.cfl.ca/
29http://www. bowmans.com
30The Mohawks of Kahnawake
The Legality of the Activities
Kahnawake First Nations: 20 square-mile
community of 8,000 Mohawks, located on the
south shore of St. Lawrence River, 20 minutes
from Montreal.
Mohawks claim jurisdiction as a “sovereign
nation” to issue gaming licenses for lottery
schemes, including race-and sports-books,
notwithstanding the provisions of the
Code–have set up their own “Gaming
Commission”.
31http://www.kingsolomons.com/
32The Mohawks of Kahnawake
The Legality of the Activities
Quebec & federal governments, and provincial
police, have investigated these activities.
– Quebec Minister of Public Security stated publicly
that Internet gaming operating from Quebec on the
Kahnawake Reserve is illegal: L. Moore, Montreal
Gazette.com, June 10, 2001
Case law to date has repeatedly ruled against
the existence of an inherent aboriginal right
to operate a commercial gaming enterprise.
– however, this issue must be re-examined in light of
particular facts re each individual First Nation.
33The Mohawks of Kahnawake
The Legality of the Activities
The Kahnawake community wants the federal
government to pass legislation designating
Kahnawake, and perhaps other reserves, as
Internet gaming jurisdictions.
– Kahnawake is so far is the only North American First Nations
to license the interactive websites.
Currently, the Mohawks host about 30 cyber
casinos, race-and sports-books, and they
remain open to discussions with
jurisdictions, including Quebec and Canada,
to harmonize their respective legislative
provisions concerning gaming.
34So Why
Is This All
Happening
? 35Consumer Trends
Lottery Corporations find themselves at
an important stage of their evolution!
Consumers are seeking
experiences that are tailored for THEM.
GLOBAL SHIFTS
ARE HAPPENING! 36Consumers are changing
Global shifts:
United States Shopping Online
– $55B in 2003 = 1.6% of total retail shopping
– Jump of 26% = over the previous year
37Consumers are changing
38Consumers are changing
Global shifts:
eGaming World Wide Estimates
– 2000 = $2.2B … 2004 = $69.4B*
– Internet Share of GGT 5.6 %*
– 58% US Global Internet penetration*
*Double or Quits? – GBGC 3rd Global Gambling Review 2004/05
39Consumers are changing
Global shifts:
Mobile Gaming is Coming!
– $19B alone by 2009
estimates Juniper Research
40Competition is now Real
41Competition is now REAL!
Global Internet Competitors
• Peer to peer
• Online Poker & Casinos
• Sports book
• Fantasy Sports
Ask yourself the question…
• Do we leave the market space open?
• How do we manage the reputation of gaming?
• What are the long-term consequences?
• What about Responsible Gaming policies?
42Internet “Exchange” Betting
What is Exchange Betting?
Peer to Peer - Individuals bet with each
other; no bookmaker.
Relies on players accepting bets offered
by other users on the exchange, or by
players setting their own odds. Result
is a market similar to a stock exchange.
To function, exchanges require many
players and high traffic to create a
reliable market.
43Internet “Exchange” Betting
Peer to Peer
Canadians can place online bets for next
CEO to get boot!
BetFair P2P turnover is said to exceed $80M
US per week with over 200,000 registered
users World wide in over 85 countries*.
*The River City Group - Internet Poker The Real Deal 2004
44Competition is now real
Online Poker
Online Poker rooms took in $1.3 billion in
revenues last year, a figure that expects to
grow to $5.8 billion by 2008.
Christiansen Capital Advisors
45Competition is now real
Party Poker - to go public this year, IPO at $10 Billion
46Competition is now real
Fantasy Sports
Today, fantasy sports attract over 15 million
consumers generating $1.6 billion yearly.
Fantasy owners build a team of professional sports
players (a fantasy roster) that compete against
other fantasy owners based on the statistics
generated by individual players from each roster.
This, in turn, offers a more engaging experience
for sports fans.
47Consumer Trends
GLOBAL SHIFTS ARE HAPPENING!
Consumers are seeking experiences
tailored JUST FOR THEM.
How Is ALC Responding ?
48Atlantic Canadian Consumers?
Technology Focus
1.8 million adults
– 71% of households have a personal computer
– 62% have Internet
– 38% high speed
– 27% comfortable using credit card
– Household income $60,000+
Other technologies adopted
– 64% cellular phones
– 29% digital music player
– 11% Palm Pilot or Blackberry
– 22% Home Theatre
– 18% HDTV
Source - Inside Out Report, Omnifacts Bristol Research, Winter 2004
49What are they doing?
Today Atlantic Canadian consumers
are using the web for many
services
– Goods and services
– Bill payments
– Renewing their driver’s license
– Purchasing stocks and bonds (investing)
Atlantic Canadians Shopping Online
– 34% shopped online in the last six months
– Average $600 each last year
50ALC’s Approach
Create an online environment that
consumers want to experience,
one that provides choice and
convenience.
– ALC.ca - 240,000 unique visits each week
– eClub Rewards - Something Extra Just for You
www.alc.ca
51Controls
Safe and secure transactional
environment for lottery consumers
– Register to play
– Player verification
– Weekly spending limits $1 - $99
– Password protected
– Self - exclusion program (day,week, month and year)
– Self - assessment pre-screen (optional)
– Links to help services
52Controls
Verification Process
The decision tree errors on the side of caution - in total
approximately 80% pass
TransUnion owns and manages the consumer data base
• 70% approx. are verified within minutes by TransUnion
• 10% approx. are verified manually by ALC
In our case why do 20% fail ?
• 3.7% Address reported misused (Attempt using a false
address like Prison)
• 4.0% Address not Atlantic Canada (Takes six weeks to show
as a resident)
• 1.6% Under Age
• 23.0% No Hit (Does not match first, last name or address -
likely made up)
• 67.6% Identity not confirmed (Would not match a few fields,
this is mostly due to typographical errors)
Some of the 20% are likely the same person attempting several times.
53Controls
Fund your account and
you are ready to play
– Consumers told us they wanted choices
– Electronic Funds Transfer and “WebCash”
Group Play
54Transactional Environment
55Challenges Going Forward
Maintain unique relationships
– Customer experience is key
– Reaction times are immediate
– Integrity is everything
New Product Integration
– Traditional games
– Innovative new products
Enterprise Architecture
– New technologies to manage
– Operational excellence
56Thank You
Play you favourite games online
Play your favourite games online.
Presented by: Maurice Richard
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