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Playwin to launch Maharashtra online lottery in May

Fakir Chand in Bangalore

Playwin Infravest Ltd., a subsidiary of the Rs 45-billion Essel Group, which has launched India's first online lottery early this month from Sikkim, is in the process of signing an agreement with the Maharashtra government for introducing the state's online gaming from this summer.

"We have already bagged license to launch online lottery of Maharashtra and Karnataka states through the competitive bidding. We will be signing the marketing agreement with the Maharashtra Government in Mumbai on April 8 and float a Lotto from this summer," Playwin Infravest CEO Sanjay Das told rediff.com in Bangalore on Tuesday.

Though the company had clinched a similar license in Punjab, the new Congress government had cancelled it in the wake of a legal fracas between Playwin and the losing bidder. "We will be competing in the fresh bid to be floated soon and secure it again transparently," Das said.

While the Sikkim super Lotto draw is scheduled on this Friday night, to be telecast live on the group's Zee Network from Gangtok, the group's subsidiaries, including Playwin are scouting for retailers across 14 states that allow inter-state lottery games for locating more electronic terminals.

"We plan to have about 3,500 such terminals across the country by this year-end, and about 10,000 terminals in the next couple of years as the game of fortune catches up like cable entertainment," Das stated, adding that once the online gaming become popular and rewarding, more games could be launched for each state with staggered draw dates.

In the three southern states (Karnataka, Kerala, and Tamil Nadu), where conventional lottery games are thriving, the latter two state governments have expressed keen interest in floating online electronic lottery games, while Karnataka is in the process of issuing a formal notification.

Similarly, in the western region, Goa and Rajasthan have agreed to open up their states for the online gaming as part of boosting tourism and generate direct or indirect employment. So are West Bengal and Orissa.

In Maharashtra and Karnataka, the company will launch its online gaming with a jackpot of Rs 20 million and scale it up to Rs 40 million in proportionate to the kind of response they generate. Incidentally, the jackpot prize for the first online Sikkim lottery is also for Rs 20 million with the price of each ticket being just Rs 10.

Initial inquiries from major cities like Mumbai, Pune, Nagpur, Nashik, in Maharashtra, and Bangalore, Mysore, Mangalore, and Hubli in Karnataka for distributorships and dealerships to install the Playwin terminals are overwhelming.

Though the tendency world over is to buy a lottery ticket (conventional or online) only during the last 48 hours of the last date of draw, the feedback from about 2,000 Playwin terminals installed so far in many states across the country indicate that around 1.7 million tickets of the Sikkim Lotto have already been bought during the first 20 days.

It's a win, win situation for everyone involved. The state governments stand to get whopping revenues in the form of taxes to the tune of 20-25 per cent against the 1 percent from the conventional lottery system, while the retail outlets installing the terminals stand to benefit all along for just an investment of Rs 350,000 on the machine and security deposit.

"Online lotteries the world over are recognized as a major source of revenues for social causes. The returns for the state exchequer are handsome. In fact, Playwin has assured the three state governments of Sikkim, Maharashtra, and Karnataka a return of 20-25 percent or Rs 30 billion during the license period of 5-10 years," Das claimed.

Moreover, the state governments are committed to provide 20 per cent of the revenue collected from online lottery games on education, rural housing, sanitation, and infrastructure development.

If the conventional lottery game, played in 14 major Indian states with almost 100 draws a day, and about 20 million people involved, can generate an estimated annual turnover of Rs 500 billion, the potential for the online gaming is immense as the sophisticated system will attract the untapped upper and middle class markets as these segments make up for a very lucrative consumer base.

Incidentally, the worldwide market for online lottery games is a whopping $125 billion, with the US and UK leading the sales in terms of terminals as well as tickets.

The group's subsidiaries have till date invested Rs 3 billion in creating the state-of-the-art infrastructure, including central computing system, communication network, and a backroom operation at Vashi in Navi Mumbai, spread over 25,000sq.ft and a 5,000sq.ft call center nearby.

Playwin has entered into an alliance with the US-based International Lottery & Totalizer Systems for the supply and maintenance of the entire hardware and software of the electronic gaming system.

The company is expecting to achieve break-even by 2004-05 with operations in almost all states and offering several online lottery games.

Since the entire game is operated electronically with no human interference at any stage, including at the time of draw, the customer or player stands to benefit all along as he/she can gamble to win prizes if 3,4, or 5 numbers of the total six numbers matches with the winning number.

In the event of nobody winning the jackpot for a particular week, the offer rolls over to the following week and continues to do so till a player matches all six numbers declared at the end of the draw.

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