Will Mega Millions be the ticket for Texas?

Nov 29, 2003, 9:29 pm (2 comments)

Texas Lottery

Multistate game debuts this week with long odds, mixed predictions

Texas' plunge into the multistate lottery market this week with its promise of mega-jackpots and new revenues for the state is a bit of a gamble, supporters and critics agree.

Tickets for the Mega Millions game go on sale Wednesday (December 3, 2003), followed by one of the twice-weekly drawings two days later (Friday, December 5, 2003).  Texas is the 11th state to join the game.

Yet-to-be answered questions: Will players be turned off by the new game's better-chance-to-be-devoured-by-a-dingo odds of winning a jackpot? And what's to become of the 11-year-old Lotto Texas game already plagued by falling sales?

Dawn Nettles of Garland, publisher of a lottery newsletter and longtime critic of the Texas Lottery Commission, says Mega Millions' 135 million-to-1 jackpot odds won't sit well with players.

But Reagan Greer, the agency's executive director, contends the big jackpots the state is counting on from the new game will be too tempting to pass up. Mega Millions is expected to produce up to five jackpots a year in the $100 million range, officials say. Its $363 million jackpot in May 2000 is the largest ever in North America.

"If the jackpot is 100 or whatever million, it's a shot at a dream and I think people will embrace that," Mr. Greer said.

Ms. Nettles isn't convinced.

"The problem is that the odds are too high," she said.

"That's not what the people want. They want lottery games, yes, but they want for a lottery a reasonable chance to win.

"And 135 million-to-1 is not reasonable."

Ms. Nettles said players tell her they would be happier with smaller jackpots if they had a better chance of winning.

Mr. Greer said the state is attempting to address the odds issues by offering Texas players a chance to "supersize" the lower-tier prizes they will have a better chance of winning.

Along with their $1 lottery ticket, they will be able to purchase for $1 more a "Megaplier" number for a chance to double, triple or quadruple any smaller prize they may win. A drawing in Austin by the lottery's new random number generator will determine the size of the multiplier. A quadruple Megaplier, for example, would increase the amount of the second-place Mega Millions prize from $175,000 to $700,000, Mr. Greer said.

The chance of "winning pretty stout amounts at the lower level" will keep Texans in the game, he said.

"That is why we put in the Megaplier."

Impact on Lotto

Cannibalization of the current games is a concern.

Last week, Mr. Greer announced that Mega Millions likely will cut deeper into Lotto Texas sales than the 21 percent originally predicted. Drawings for that game are Wednesday and Saturday nights, while Mega Millions drawings will be on Tuesday and Friday nights.

If the new game does cut deeper into Lotto Texas than expected, the older game may have to undergo its third overhaul since 2000.

The last change in March was an attempt to make it harder to win jackpots, allowing them to roll over and grow, attracting more players. But players have been beating the odds with enough regularity to keep the jackpots relatively small.

"They [jackpots] were consistently being hit at that $4-, $5-, $10-million mark. It hasn't delivered the $60 million or $100 million" jackpots that were expected, Mr. Greer said.

He said he will be keeping an eye on Lotto Texas sales in the coming months.

"If sales fall off in the high 20 or 30 percent range," changes may have to be made in the game, Mr. Greer said.

There are no plans to shelve Lotto Texas, however.

"I'm committed to the game. I'm committed to keeping it in good health," he said.

Texas Two Step, another game, may not be so fortunate because its twice-weekly drawings are on the same nights as Mega Millions.

Given the choice of putting their $1 on Texas Two-Step for a chance to win $250,000 or going for the expected $30 million Mega Millions jackpot this Friday, most players likely would opt for the bigger prize, Mr. Greer said.

He said he will wait to see what happens before making decisions on any of the current games.

"I'm not liking the fact that there is a lot of uncharted water here and I just want to be proactive and not reactive," he said.

Lawmakers authorized the lottery to join a multistate or multinational game this year.

Revenue estimate

Lottery officials have estimated that the new game will bring in an additional $121.6 million a year on average over the next five years for the state. The state's current games the lottery games plus scratch card games raise about $1 billion. Lottery revenues are earmarked for public schools.

Mega Millions was called the Big Game when it debuted in September 1996 in Georgia, Illinois, Maryland, Massachusetts, Michigan and Virginia. The name was changed last year when New York, New Jersey, Ohio and Washington joined.

Lottery officials chose Mega Millions over Powerball, the nation's other big multistate game, in August.

Lottery Post Editor's Note:

The opinion of Dawn Nettles in this story was presented in order to provide a fair and balanced view.

However, this editor wishes to point out that Ms. Nettles' viewpoint does not jibe with the facts, and further appears to mask ulterior motives.

Our points of commentary:

In identifying these points, this editor seeks to bring to light tactics and motivations that may not otherwise be apparent.  We do not seek to conceal criticism of lottery organizations; on the contrary we have made several criticisms ourselves.  Rather, we are called to action when a loud voice in the industry may be unfairly criticizing others for personal gain.

Dallas Morning News / Lottery Post Staff

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vincejr's avatarvincejr

Thanks for the editorial note Todd. It is often helpful to know the possible "conflicts of interest" or biases of the so-called experts the mass media often uses to fill its articles.

dvdiva's avatardvdiva

similar jackpots? where is that news coming from? i predict that texas lotto sales will fal (it's not a good game anyways the odds are way to bad for the number of players) mean while mega will offer even lower jackpots - yay

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