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Tuesday, April 13, 2004

Study supports Internet lottery


Games Inc. pushes option; Ohio officials show no interest

By Cliff Peale
The Cincinnati Enquirer

University of Cincinnati researchers say selling Ohio Lottery tickets over the Internet could add $1.18 billion in lottery sales over five years, though lottery officials said Monday they aren't considering such a move.

The study was funded by Cincinnati company Games Inc., which controls the www.lottery.com Internet site and has worked for years to become a state lottery retailer.

Games wants a share of a $42 billion national lottery market and will use the study to argue that allowing online sales would create new dollars for the state that otherwise might go to casinos or other entertainment.

"We believe there are many players who play occasionally," said Roger Ach, chief executive officer at Games Inc. "If you make it convenient for them or provide some sort of subscription service, that player would be a new (regular) player."

Ach has been lobbying officials in Columbus and in other states for years. He said added lottery revenue could be another source of education funding. The UC study showed that $1.2 billion in new sales could add $376 million in education funding over the same five years.

But no states sell lottery tickets over the Internet, and Ohio Lottery officials don't sound eager to be the first.

"It's not something we are looking at," spokeswoman Mardele Cohen said. "Gov. (Bob) Taft has been pretty clear with my director that Internet lottery sales are not something he's interested in."

Lottery officials have not seen the UC study.

Skeptics of Internet lottery sales worry about gambling addictions, underage gamblers and the financial hit that storeowners - and therefore the lottery - might face.

Ach said Games has developed a secure Internet site that could handle those concerns. And the UC study predicts that about 30 percent of players who use the Internet could become lottery players if there were an Internet option.

The Economics Center for Education and Research at UC conducted the economic impact study. Director George Vredeveld said there is no hard data on the impact of online lottery sales, since no states are doing it yet, so gauging the impact is difficult.

For the fiscal year ended June 30, 2003, the Ohio Lottery collected total revenue of $2.23 billion. The revenue has fluctuated between $2 billion and $2.45 billion during the last decade.

---

E-mail cpeale@enquirer.com

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