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NZ Lotteries may begin selling Lotto tickets online as early as next month, according to franchisees, some of whom fear the effects on their businesses already feeling the pinch from plummeting consumer confidence.
Spokeswoman Karen Jones says NZ Lotteries is now at the final stages of completing plans to let people buy tickets to its Saturday Lotto and Big Wednesday draws over the Web.
Retailers say punters would pay for tickets using a credit card and get a unique serial number that they would be able to print out as a receipt.
Internal Affairs Minister Rick Barker has yet to approve the necessary changes to Lotto’s game rules, but suggests that may be a formality given "Parliament has previously determined that NZ Lotteries can offer its products over the Internet".
NZ Lotteries and the TAB were excluded from an online gambling ban in 2003 so they could provide people with a "relatively safe alternative" to games offered by overseas operators, keeping any benefits in New Zealand, he says.
Lotto outlets—which now number more than 1000 — earned $51.5 million last year from a 7 per cent commission on ticket sales.
The owner of one franchise in central Wellington says fewer people will walk into his shop when ticket sales go online.
He says 60 per cent of his sales are for Lotto, grossing about $20,000 each week.
"Am I expecting it to hurt? Yes. Look at my location, every Tom, Dick and Harry around me has got Internet access. Would you wait here in the queue or go on the Net and print one out?"
He says he would be reluctant to check tickets sold online. "I’m not going to get anything out of it."
Another inner-city retailer says the move will hurt his business because people will not leave their offices to buy tickets.
But a northern suburbs dairy owner who recently became a Lotto franchisee to increase "foot traffic" doubted that convenience stores would be badly affected. "Everything is going online", but many customers would feel more confident holding a winning ticket that had been printed in a Lotto shop, he says. He had been told to expect the launch of online Lotto ticket sales in April.
Another retailer said he had been told ticket sales would probably go online within a few weeks. There is speculation that NZ Lotteries may time the launch for a week when there are no massive jackpots on offer.
Ms Jones says people write to NZ Lotteries "every week or so" saying they would like to be able to buy Lotto tickets online, but based on overseas experience, only a few per cent of ticket sales are likely to be made over the Internet.
She expects 2 per cent to 3 per cent of tickets would be bought online in the first year, and online sales would only pick up from that level when large jackpots were on offer. "It is aimed at people who are infrequent players, who cannot be bothered going to a Lotto store."
In Britain, where lotto tickets have been sold online since 2003, online sales accounted for 7 per cent of sales in the second half of last year, raking in £163.3 million (NZ$412.9 million). More than three million players in the National Lottery have registered to buy tickets on the Net, through interactive TV and via their mobiles, says national operator Camelot.
Ms Jones says retailers will continue to be Lotto’s most important sales channel for the foreseeable future and retailers would not be expected to redeem prize-winning tickets that were bought online.
Unlike Britain’s National Lottery, NZ Lotteries would not offer an equivalent of its Instant Kiwi "scratchies" online.
Ms Jones says NZ Lotteries has told prospective franchisees of its plans to sell tickets over the Web since August and has been "very open" with all its retailers.
- © Fairfax NZ News