Lottery giant GTECH criticizes rival Scientific Games for 'dark day'
Colorado plans to halt lottery ticket sales for one day this spring while workers install machines that verify which tickets are winners.
New York-based Scientific Games is taking over the job of managing the lottery machines under a state contract worth an estimated $43.5 million. The switch to Scientific Games was supposed to happen Nov. 1 last year, but glitches delayed it twice, pushing the start date to May 2.
Lottery sales will be suspended May 1 while workers put the machines in the 2,500 stores across Colorado that sell tickets.
Scientific Games has had trouble meeting deadlines, though. The firm has paid nearly $1.5 million in contract penalties to compensate the state for two delays.
Aside from a day without lottery sales, consumers wont notice a difference in how they buy scratch tickets or Lotto or Powerball tickets, said Nolan Jones, who is managing the equipment switch for the Colorado Department of Revenue.
We wanted to make sure that the system was ready to go, Jones said. We took advantage of the fact that we had two opportunities to make sure that this thing is as transparent as possible.
Even a one-day shut down could mean a significant money loss for the lottery, which provides money for parks across the state. Ticket sales were $386.2 million in 2003, the latest figures available. Much of that money went to prizes and business commissions, but $103.7 million was for state parks and to help local governments buy parks and open space.
A competitor with Scientific Games, Rhode Island-based GTECH, said a dark day is unusual in the industry, especially given that Scientific Games had two years from when it was awarded the contract to the deadline. GTECH has handled the ticket verification machines since 1988, but it lost a bid to continue in 2002.
Bob Vincent, GTECHs vice president of corporate communications, sent an e-mail message to Colorado media outlets Monday suggesting that Scientific Games had failed its obligations.
Its fine that we went through a procurement (bid) and were not successful, but you have to be able to deliver on the solution that you bid, Vincent said.
Vincent said Scientific Games relationship with the state was especially unusual because the state granted a contract extension even before the initial work was complete. The contract with Scientific Games initially was for six years, but in January the state granted a two-year extension.
The extension was worth about $14 million, Scientific Games said in a Jan. 17 news release.
Scientific Games had not responded to a request for comment late Monday.
The Colorado Bureau of Investigation last year investigated gifts received by lottery employees from two department contractors, including Scientific Games. Department of Revenue spokeswoman Diane Reimer said Monday that the investigation resulted only in a policy change prohibiting employees from accepting gifts.
Well, GTech got Florida from Scientific Games (which owns what was once known as the AWI technology). So, GTech is not losing too much. You win some, you lose some. I think GTech makes a superior product, but Scientific's terminals have a sentimental value to me, because that's what I remember in Florida.
That's actually just the revenue that the GOVERNMENT sees (after prizes, administrative expenses, the retailer's cut, etc.) of $1.4 billion. Total sales are over $5.1 billion.
Note how GTech is calling this a 'dark' day. You'd think only a terribly addicted gambler would say something like that. But it shows you how GTech is so used to gaining clients as opposed to losing them. Sometimes GTech even buys lotteries outright. Geez, let SciGames get a new client.
Well, GTech got Florida from Scientific Games (which owns what was once known as the AWI technology). So, GTech is not losing too much. You win some, you lose some. I think GTech makes a superior product, but Scientific's terminals have a sentimental value to me, because that's what I remember in Florida.
Too bad they didn't move it up to April 1 although I don't know how popular those "joke" tickets would be.
Gifts for lottery employees and a two year extension for Scientific Games, what a coincidence.
Colorado makes $1.4 billion in annual lottery revenue, which comes out to around $4mm per day. I hope they're compensating the state for that, too.
Bingo:
Without a Pick 3 game, I doubt CO's yearly sales are over a billion.
That's actually just the revenue that the GOVERNMENT sees (after prizes, administrative expenses, the retailer's cut, etc.) of $1.4 billion. Total sales are over $5.1 billion.
Check out page 5 of this pdf for profit info.
they should do this on the day they have the least lottery sales,like on a sunday.....
Note how GTech is calling this a 'dark' day. You'd think only a terribly addicted gambler would say something like that. But it shows you how GTech is so used to gaining clients as opposed to losing them. Sometimes GTech even buys lotteries outright. Geez, let SciGames get a new client.
$5.1 BILLION per year? That's almost what the NY Lottery takes in yearly. Maybe the $5.1B is over the lifetime of the CO Lottery.
Sorry, that was cumulative. I thought the numbers looked high, but couldn't figure out why.
Thanks for pointing that out.
either that or colorado sells an awful lot of tickets......
CO needs a Pick-3, and to replace its lotto with Hot Lotto.
colorado doesn't have pick 3?
Mike:
Yes, that's correct.