The Michigan lottery will join the 21st century sometime this spring when the sale of online lottery tickets begins. State lottery officials say that online ticket sales will bring in more revenue for schools and improve the lottery experience. Not everyone is happy about the online sales and several lottery retailers say that online ticket sales will hurt their businesses. This spring Michigan plans to sell online subscriptions for draw games such as Mega Millions and Powerball.
The Daily 3, Daily 4 and Club Keno games will not be part of the initial subscription program Kurt Weiss, spokesman for Gov. Rick Snyder, said the subscription program allows players to sign up for multiple ticket purchases over a specified period of time. A new system called iLottery will be launched towards the end of the year and will offer single tickets and instant win games. The types of games that will be available on the iLottery system will depend on the results of a request for proposals that is due March 26th.
In an email Weiss stated “This is part of the overall goal of having the Lottery continually evolving its product to meet the demands of its players, and continually adapting to the current technology to meet those needs. The Lottery has gone from 40 years ago offering a single ticket advertised to players through minimal channels, to offering a number of games with multiple price points and brands that are advertised in an array of markets.” Governor Snyder’s latest proposal called for $3.3 million to be used to launch the iLottery system which would include online, mobile and tablet applications used for ticket sales.
The state hopes that the new iLottery will generate an additional $118 million to be used for the Michigan School Aid Fund during the first four years of the iLottery program. Officials are hoping for another $361 million over the following four years. Since its launch in 1972 the Michigan lottery has contributed more than $17 billion to education. Last year the lottery gave $778.4 million to the school aid fund. Gas station and convenience store owners have expressed concerns about lost business due to online ticket sales. Lottery retailers earn a 6% commission on the lottery tickets they sell.
Retailers are concerned about losing the commissions and say that online ticket sales will reduce foot traffic from people stopping in to pick up tickets. Michigan Lottery Commissioner Scott Bowen said that several studies have shown that online lottery ticket sales do not adversely impact retailers. In written testimony for a House appropriations hearing Bowen stated “In fact, our plans would create new opportunities for retailers to earn commissions related to iLottery transactions. We have met several times with the trade organizations representing our retailers and are in communication with them on a regular basis regarding iLottery.”