Lottoland tries to get retail sellers onside ahead of Aussie banning legislation

News on 5 Apr 2018

Secondary lottery provider Lottoland, under siege in Australia from established industry majors and retail ticket sellers, has made an attempt to get newsagents onside by offering them a 20 percent cut of sales and reassuring them that Lottoland Australia in no way competes with them.

The offer comes as Australian lawmakers in the House of Representatives move closer to passing a bill banning Lottoland “synthetic lottery” activity following a long and bitter campaign against the genre (see previous reports).

In full-page newspaper advertisements on Thursday, Lottoland chief executive Luke Brill offered newsagents 20 percent of the profits generated from every bet they refer to Lottoland. The open letter observes:

“To be clear: Lottoland Australia does not offer betting services on Australian lotteries. We sell no products that newsagents sell. We do not compete directly with you and we have no intention of doing so in future.

“In fact, no one has come up with credible evidence that actually proves that Lottoland Australia has taken sales away from newsagents. We want to partner with newsagents to provide our customers with greater choice, in a way that will be fair and profitable for your business.”

Brill also attacked established industry companies, noting that newsagents should be worried about the threat of Tatts which was “continuing to promote the digital sale of its products, such as Powerball and OZLotto”.

“According to Tatts’ own figures, their digital sales increased by a massive 30 per cent in the half year to December 31 – money Tatts has diverted away from newsagents and other small businesses,” Brill claimed.

“If passed, the legislation proposed by Canberra will cement Tatts’ monopoly, which is not good news for newsagents – or for customers.”

The CEO of the Australian Lottery and Newsagents Association, Adam Joy, responded by claiming that Lottoland needs the goodwill that newsagents have worked hard to achieve, and suggested to members that the Lottoland offer was motivated by a need to make commercial gains from newsagents.

“It is a last-ditch attempt at survival and comes as the federal government moves to protect punters from a high-risk business,” Joy claimed. “Why would newsagents align themselves with a business that is free of consumer protections and does not always deliver what it promotes?”

Joy alleged that newsagents would be acting as cheap advertising for a betting product that does not always pay out the advertised amount. “This offer is in line with Lottoland’s bait-and-switch model,” he said.

“Lottoland have spent years denigrating newsagents, and a partnership requires trust. They have repeatedly said that they are not targeting the customers of newsagents, yet this idea along with its entire business model does exactly that.

“The negative impact of Lottoland has never only been to the more than 4000 small businesses and their 15,000-plus employees that are regulated lottery retailers. Lottoland negatively affects the consumers who have been misled by its online schemes and the community that have been concerned about the impact on state tax revenues.”

Federal Communications Minister Mitch Fifield has said the banning legislation is in the form of an amendment to the Interactive Gambling Act, and would come into effect six months after passage through the Legislature in order to give companies affected by it sufficient time to shut down..

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