Camelot's plan for 100 millionaires a month in world lottery

Saturday, February 10, 2007 posted 04:37 AM EST

A worldwide draw creating more than 100 millionaires a month could become a reality if the national lottery operator, Camelot, is granted a further 10-year licence to run the UK game.

Camelot, which has been in charge of the British lottery since it started in 1994, unveiled its plans at the National Gallery in London yesterday. The company claims to have had "expressions of interest" from 48 national and US state lottery groups around the world, all keen to learn more about its proposals for a global draw.

Launching a bid to retain the UK lottery licence, chief executive Dianne Thompson was giving away few details of how the world lottery would be structured, beyond pointing to jackpots far outstripping those generated by EuroMillions.

EuroMillions, launched three years ago and now operating in nine countries, has generated jackpots of up to £125m.

The proposals for a world lottery draw involve individual numbered balls each drawn in different continents before a final ball, completing the winning number sequence, is picked during a live television broadcast.

Ms Thompson said EuroMillions had "created the most exciting bout of lottery fever ever, raising £100m [in a 23-week period] for UK good causes". A world lottery draw could be even better at meeting the ever-increasing demands from good causes for cash.

The proposal is the centrepiece of Camelot's £20m bid to retain the national lottery licence, made in conjunction with technology partners IBM and G-Tech. The only challenger before yesterday's deadline was the Indian firm Sugal & Damani, a conglomerate with interests ranging from diamonds to tourism and Indian state lotteries.

In contrast to Camelot's presentation at the National Gallery, the Mumbai-based Sugal & Damani issued a single-page press release, handed out to reporters on the steps of the Camelot-booked venue. It said the group "has complete hold over all the technological aspects of the modern lottery business and feels confident it has done a good job as far as the bidding process goes." Sugal & Damani, which submitted its bid after negotiating a deadline extension, said it did not have a software partner and would be using its own technology.

Receiving the two bids, Robert Foster, of the National Lottery Commission, said the process remained "highly competitive". But many high-profile potential bidders - BSkyB, Sir Richard Branson's People's Lottery, Ladbrokes and Turkish lottery operator Intralot - had lost their appetite months ago, blaming the prohibitive cost of bidding.

A source close to the regulator last year said the lottery commission would be "delighted just to get three bids". Such is the perceived strength of Camelot that regulators have struggled to give the appearance that the third licence bid is a competitive process.

The group, owned by Royal Mail, De La Rue, Cadbury Schweppes, Thales and Japan's Fujitsu, last year increased ticket sales by 5.2%, the biggest rise in eight years. Controversial scratch cards and instant win games were central to the lottery's renewed growth.

Sir Richard Branson, with whom Camelot fought a bitter battle for the current licence seven years ago, has made clear his view that it would be "very, very difficult to topple Camelot" this time.

Asked how much Sugal & Damani had spent on its bid, a spokesman said: "I don't want to quote a figure. It would lead to unnecessary gossip." He said it was less than £20m.

Meanwhile, MPs have expressed concern that the National Lottery licence could fall into the hands of an untested operator at a time when good causes funds have been earmarked to underpin funding of the 2012 Olympics.

The lottery is already committed to raising £1.5bn to help fund the Olympic Games - and, as the costs of the project spiral, further funds are likely to be sought.

The lottery commission must now conduct probity as well as financial and technical capability checks on the two bidders and their partners.

It will then award the 10-year licence, to run from 2009, solely on the basis of how much money candidates can raise for good causes.

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