The group that won the contract to run the struggling Illinois Lottery, Camelot, believes that it could bring in $4 billion in sales next year. Camelot Illinois, a subsidiary of the operator of the UK’s National Lottery, will take over the contract from Northstar at the beginning of next year, after the latter failed to reach its own revenue projections. Northstar, a venture between International Game Technology (IGT) and Scientific Games, beat Camelot to win the Illinois Lottery account ten years ago, however it was fired after raising only $2.85 billion in its most recent fiscal year. Camelot was the only group that bid for the new ten-year contract.
Camelot said that it has big plans for the Illinois Lottery, and will concentrate on new sectors such as marketing through mobile apps. The group has a lot to win and a lot to lose, depending on its success in its first year and beyond. According to the terms of the contract, Camelot Illinois has to make a net profit of $731 million. As difficult as this may seem, the group could be looking at incentive bonuses worth up to 27% of the profits.
Camelot said that it would spend $15 million upgrading equipment and technology in order to give Illinois lottery players a better gaming experience.
Hoping not to meet the same fate as Northstar, Camelot Illinois has announced a number of steps that it will be taking from January next year. In particular, the group will review and reconcile management fees at the start of each year. Camelot believes that by the end of its ten-year contract, it will have paid out over $23 billion in prizes to lucky players.
“The more we grow, the more we sell, the more state benefits and so do we,” Neil Brocklehurst, Camelot managing director, is quoted by the State Journal-Register as saying.
In 2009, Illinois became the first state to privatize its lottery. It was believed that an external company would bring in bigger profits and it was hoped that contributions to Illinois’ education fund would grow. However, for the past two years, the lottery posted flat sales, impacting the money that went to education.
