New Online Lottery Expected To Generate $250 Million For PA

Written By Joss Wood on January 12, 2018 - Last Updated on October 17, 2022
PA lottery available online

Legislative changes in Pennsylvania expanding gambling should shortly result in lottery games becoming available online.

An article on TribLive quotes “a lottery spokesman” saying that online lottery games could come to the market some time in spring.

They also quote Doug Harbach of the Pennsylvania Gaming Control Board (PGCB):

“We’re just talking with the (casino) companies that would be involved in online gaming and what’s being offered. We have to put together regulations that will guide not only the games themselves, but also the licensing.”

There’s no mandated time frame for when the PGCB has to produce regulations. However, the size of the lottery market means that the potential additional revenues to the state are substantial.

Pennsylvania lottery proceeds underwrite tax and rent rebates, prescription drug subsidies, and other benefits. Over the last six years the state lottery has generated over $1 billion.

New online lottery games will create extra revenues

Buying lottery tickets online will make it easier for customers to take part and, therefore, result in more sales. Additionally, revenues should also expand with new games online technology make possible.

Retailers concerned about reduced lottery ticket sales will be able to offer an online experience in-store. As a result, the net effect on them could be positive. Customers may also be able to play online games such as Keno and possibly place virtual sports bets.

Estimates of the possible additional annual revenue expect as much as $250 million over the next five years.

Online lotteries are expanding across US states

These states all offer either full service or limited lottery games online:

  • Illinois
  • Michigan
  • Georgia
  • Kentucky
  • North Dakota
  • North Carolina

New Hampshire will join them in early 2018.

Until 2011, states were prevented from offering online lottery tickets by the Department of Justice’s (DOJ) interpretation of the Wire Act. New York and Illinois proposed online lotteries in 2009, and the DOJ reversed its position stating that the law only applied to sports betting.

The new opinion immediately led to states regaining control over internet gambling–less sports betting. Subsequently, the gradual roll-out of state-regulated online gambling began.

Pennsylvania’s benefits stand to be high

In 2016 Pennsylvania’s total lottery sales came in at $4.14 billion from a population of 12.8 million. Georgia actually has a smaller population of 10.3 million, but its 2016 lottery sales amounted to $4.56 billion.

Median household income in Georgia is $51,244 against $55,702 for Pennsylvania. While that isn’t the only factor involved, the implication is that online lottery will have a major impact on lottery revenues.

What should drive the extra revenues to the higher end of expectations is the additional games Pennsylvania will authorize.

Michigan offers a wide range of games as part of its lottery and performs much better than Illinois, which not only restricts the types of games, but which also has a low return to player percentage.

Pennsylvania may have high gaming taxes, but in all other respects, the new laws give the lottery the freedom of action necessary to maximize revenues.

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Joss Wood

Joss Wood has a master’s degree in organisational development from the University of Manchester as well as an English degree from the University of Birmingham and also earned. His writing primarily centers on international online gambling markets, though he also writes about the legal US online gambling industry in addition to sports betting and esports gambling.

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