Tickets to reach players’ doors

New York’s gambling regulator, the New York Gaming Commission, has approved a law permitting the delivery of instant-win lottery tickets. Now, the Empire State’s lottery players can order scratch-off tickets to their homes through a mobile app.

New York must raise at least $15bn per year in the next two budget cycles

The commission approved the rule on Tuesday this week, as New York looks to increase state revenue in response to the financial burden of the coronavirus pandemic. In a COVID-19 briefing this month, Governor Andrew Cuomo said New York must raise at least $15bn per year in the next two budget cycles.

Jackpocket, the company that runs New York’s lottery app, already offers a mobile ordering system for lottery draw tickets. However, this new rule allows the company to deliver scratch-off tickets to participants’ homes. Players must still travel to a store to collect winnings for a successful ticket.

Reactions from both sides

In addition to New York’s lottery, Jackpocket runs lottery apps in a number of other states, including Texas, Colorado, and New Jersey. Company CEO Pete Sullivan is fully behind the idea of ticket deliveries. According to a report by the Associated Press, the executive said it is helping to attract younger customers.

I think it’s a win-win.”

Stating that the lottery is attracting “a new demographic of players”, Sullivan observed: “I don’t think we’re going to change the behaviour of people like my father who go to the same corner store every day. But … if we can provide somebody a safe alternative and a new distribution model, I think it’s a win-win.”

Meanwhile, some of New York’s store owners are less convinced by the delivery plan. The New York Association of Convenience Stores has raised serious concerns about Tuesday’s decision, citing potential difficulties in player age verification. It also noted Jackpocket’s 9% fee on deposits, in comparison to the 6% commission earned by retailers.

Other revenue-raising systems

On January 11 this year, Gov. Cuomo announced a new seven-point action plan to “win the COVID war”. In addition to combating the spread of the disease, the plan also set out ways to counter the economic impact of the pandemic statewide.

Among the measures he outlined was the introduction of a New York legal mobile sports betting market. This is something legislators have attempted to propose since the state launched its land-based sports betting market in 2019. Cuomo’s opposition previously made such a market unattainable.

Cuomo has established his support for a lottery-like sports betting system

The governor has said he expects online sports wagering to generate annual revenue of $500m for the state once it is up and running. However, this is based on estimates for a state-run model. Cuomo has established his support for a lottery-like sports betting system since announcing plans for the new market.

Despite Cuomo’s intentions, two legislative bills that set out a market with a multiple provider approach are currently under consideration. A recent study predicts that an open retail and mobile sports betting market in New York could eventually generate up to $1.14bn per year in revenue. This would correspond to tax contributions of up to $104m annually.