Lottoland Revenue Sharing Plan Gets No Love from Lottery Retailers
Earlier this week, officials from the online lottery operator pitched a very generous offer to its biggest critics. In exchange for the privilege of operating on their turf, Lottoland would pay newsagents a 10 percent cut of wagers made by their customers. (Sound familiar?)
The plan would have relied on Lottoland customers to specify a specific newsagent to receive the kickback from their purchases. In exchange for the revenue share, newsagents would be required to hang Lottoland banners and promotions in their establishments. While certainly innovative, the revenue-sharing scheme was not well received by newsagents who claim that Lottoland’s disruptive business model is eating away at lottery sales and tax revenue.
In a statement to the press, as reported on by The Australian, Australian Lottery and Newsagents Association CEO Adam Joy said he expected his members to reject the deal and that, “Lottoland has not acted in a way to date that you would call reputable or transparent.”
A clearly exasperated Lottoland Australia CEO Luke Brill pointed out the extreme nature of his company’s offer saying:
We will take a hit to our margin but we appreciate that we need to act and listen to the newsagents and consumers and this is our attempt at doing that. We aren’t the big, bad enemy. We are happy to work with newsagents and compensate them and help them transition from offline to online.
Lottoland has also offered to pay taxes to the Australian government to compensate for lost lottery sales. Those offers have, thus far, been rejected.