N.L. has yet to make decision about joining online gaming plan
The Atlantic Lottery Corp. (ALC) is pushing for online casino gambling as it projects a drop in revenues from its existing offerings, according to Finance Minister Tom Marshall.
Newfoundland and Labrador Finance Minister Tom Marshall
And ALC is hoping to eventually take its virtual casinos on the road, Marshall said.
“ALC are obviously looking to grow, like any business would,” Marshall said in an interview.
“In addition to looking at getting into the online gambling business in Atlantic Canada, they also want to look at getting into the business elsewhere in the world as well. That would be the second phase.
“So they could go to some country or some state and say, ‘Look, we’ve been doing this for 30 years. If you want to get into this, we can do it for you.’ Or they could also provide consultation service to such states or countries.”
Marshall said the lottery corporation is projecting declining revenues from its current games.
The reasons, he said, include:
• product maturity and natural decline rates;
• no growth in the size of the market;
• decreasing profit margins, due to necessary reinvestments with no corresponding revenue increase — for example, replacing old machines with newer ones.
The province has also pulled the plug on more than 25 per cent of its video-lottery terminals (VLTs) over the past five years.
Overall, Marshall said, Newfoundland and Labrador’s revenues from ALC are projected to decline by a total of $55 million over the next decade, based on the corporation’s current offerings.
“They want to go after the online gambling market, and they feel they can take 35 per cent of it,” the minister noted.
ALC currently estimates that more than $50 million is leaving Atlantic Canada to offshore poker and casino websites.
Giving the green light to ALC’s online gambling plans would translate into additional cash of $23.5 million for Newfoundland and Labrador alone over the next five years, Marshall said, and $10 million a year after that.
He said Newfoundland and Labrador is one of three Atlantic provinces still considering whether to roll the dice on online casino gambling.
Nova Scotia and New Brunswick have also yet to decide, according to Marshall, while Prince Edward Island is onboard with ALC.
Atlantic Lottery officials initially agreed to an interview, then later declined.
In an e-mailed statement, director of public affairs Paula Dyke said the corporation has “the ultimate goal of providing fun, entertaining products in a safe, regulated environment.”
“There will be discussion and cabinet will make a decision. And it will be thoroughly analyzed and thoroughly discussed, then a decision will be made.” Finance Minister Tom Marshall
Dyke indicated that ALC would not answer any questions about what the corporation’s online casino gambling gambit might entail.
“We wouldn’t release information that could potentially be harmful to our business such as project timelines, profit projections and details of potential offerings,” she said.
Meanwhile, back in Newfoundland, Marshall scoffed at suggestions that government support for online gaming is a fait accompli.
“The fix isn’t in here,” Marshall said.
“There will be discussion and cabinet will make a decision. And it will be thoroughly analyzed and thoroughly discussed, then a decision will be made.”
He acknowledged there would be advantages to green-lighting the plan.
Marshall said there are an estimated 2,000 illegal, unregulated gaming sites.
“The black market is there already,” he noted.
“So the question is, do we just let that carry on — these unregulated sites, these illegal sites — or should ALC get into that business so at least you’ve got at least a regulated site, a legal site, a responsible gambling site, and then the revenues could be used for purposes here in the province.”
In July, British Columbia became the first province to offer online casino gambling.
But B.C. was forced to take its system offline on opening day when a glitch allowed some gamblers access to other players’ account information.
And this week, Ontario signalled its intent to move forward with online casino gaming.
Other provinces are also considering the concept.
ALC has offered a form of online betting since 2004 called Playsphere.
Playsphere allows gamblers to do things like buy lottery tickets online.
It does not let them bet in a casino-style setting, through games such as poker and blackjack.
Gambling-related cash is important to the Newfoundland and Labrador treasury.
This year, the province has budgeted to receive $101 million in lottery revenues.