Can Slots Save Bay State's Lottery? 

Christiansen Capital Advisers released a study of the Massachusetts Lottery indicating that the lottery’s revenue would receive a much needed boost if they were to add slot machines and virtual horse racing to their game menu.

The Massachusetts Treasurer’s office commissioned the report.  Christiansen Capital Advisers are an independent gaming industry consultant.  Their study centered around games currently offered or proposed by the Bay State’s Lottery. 

The lottery has begun to feel pressure from legal casinos in the surrounding states as well as online casinos.  The lottery needs a new way to keep people interested. 

According to the report, in order to prevent losing players and much need revenue, the lottery must continue to create new and entertaining games.  Loss of lottery revenues hurts everyone in the state.  Those funds are reinvested in cities and towns in the form of local aid. 

Alison Mitchell, a spokeswoman for the Treasurer’s office, claims the Massachusetts Lottery brought in $4.48 billion in the 2005 fiscal year. 

Christiansen Capital’s research points to the installation of video lottery terminals in four of Massachusetts race tracks as potentially generating the most revenue.  The lottery can expect to see an additional $1.1 billion annually from the presence of 8,000 terminals. 

The initial impact of slot machines, according to the report, would be a reduction in lottery sales, approximately 3.7 percent in both the first and second year.  By about the fifth year, sale will recuperate to prior levels.  Keno sales would get a 21.7 percent increase from virtual horse racing.  That translates into about $168 million.

Virtual horse racing games are not receiving support from upstart track owners for fear the games will steal away potential business.  That is not the consensus reached by the gaming consultants at Christensen Capital Advisers. 

The Massachusetts Treasury office discussed the introduction of Keno-style bingo, televised by Comcast cable.  They requested the consulting firm research the expected return from such an endeavor.  According to the report, Keno-style bingo was worth exploring but placed it on the state to ensure that it did not have an adverse affect on traditional, charitable bingo halls.

The report admits “Developing new hit games is extremely difficult.”  Lottery ideas like an electronic card that permits players access to multiple games at the price of one were condemned as a waste. 

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