Last Updated on September 19, 2017 by Trevor Hallsey
Lack of digital gambling products causing revenue pangs for Atlantic Lottery Corp.
The lottery products of Canada’s Atlantic provinces, New Brunswick, Newfoundland & Labrador, Nova Scotia and Prince Edward Island, are regulated under the monopoly of the Atlantic Lottery Corporation (ALC). It’s been this way for decades, and there’s no expected change in the foreseeable future. What is expected, however, is an expanded digital gambling product that could eventually match that of other iGaming provinces.
On Monday, the ALC published its revenue report for the fiscal year 2016-17. There were both positive and negative realizations, but for the ALC’s CEO, Brent Scrimshaw, there’s too much going into the negative column.
One the one hand, the regulators profit came in at $422 million, exceeding their target by $6.5 million. This marks the fourth straight year in which the ALC has surpassed its profit goal. This is great news for the Atlantic provinces.
Unfortunately, it still resulted in a near $10 million decrease from ALC’s profit margin in the previous 2015-16 fiscal year. On the whole, revenue fell 3% to $1.15 billion. That includes a 4.6% reduction in lottery sales ($699 million), and a 1% drop in video lottery receipts, ($434 million).
Entertainment center revenue did increase in FY16-17, up 4% to $19.2 million. That’s a mere drop in the bucket in comparison to the declining revenue sources.
Mr. Scrimshaw was displeased with the results, to put it mildly. Not only is he blaming the lack of a comprehensive digital product—i.e. internet casino and poker—for ALC being “not yet fully product competitive”. He’s been pushing for ALC to expand its internet gambling market for years. Yet the ALC has yet to do anything beyond simple online lottery ticket sales.
Full Digital Gambling Product Needed
The CEO is well aware of the considerably elevated profit margins in other provinces where online gaming is wholly supporteavailable. British Columbia, Manitoba, Ontario and Quebec are thriving, and their governments are quick to point the finger at diverse internet gaming products as the primary catalyst for success.
Mr. Scrimshaw specifically blamed “slowing economies, increased competition and the accelerating shift to digital – a channel in which we are not yet fully product competitive.” While his disappointment was evident, he made a point to focus on the positive aspects at hand. ALC is “returning C$60m more per year than we were just five years ago,” he lauded.
ALC Upgrades Online Lottery Systems
At the moment, ALC only provides a minimum number of digital gambling products. Users can currently play online scratch tickets and instant win games, purchase lottery draw tickets, and partake in iBingo and sports betting. Scrimshaw promised that the variety of digital gaming content will increase, and sooner than later.
Over the weekend, ALC shut its operations down long enough to perform a major system update. It included the lottery systems, as well as their digital offerings. The ALC is assuring players that, before the year is out, new online and mobile games will appear on the ALC.ca digital platform.
In speaking with the media on Monday, Mr. Scrimshaw confirmed that their online gambling platform will soon “compete with what’s coming out from those companies that have the globe as their marketplace.”
He did not go into details as to what types of games they will soon offer. However, he did hint at a range of online casino products when he said the ALC is “looking for products that are skill-based, entertaining and interactive”.
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