Irish Firm Inks Mobile Lotto Deal With GTECH

An Irish-based mobile payments software firm inked a deal with GTech Corporation, one of the world's largest lottery service providers, which will create a new mobile payment solution for lottery players.

Officials with Valista announced the partnership last month and said the agreement offers them the ideal partner for getting into the global lottery marketplace.

As part of the deal GTech will integrate Valista's service delivery platform into its own Enterprise Series Interactive architecture. The addition will allow lottery players to buy lottery tickets on mobile phones, PDAs and other portable electronic devices.

Richard Koppel, vice president of GTech Corporation, said the deal is unlike any other the company or its competitors has signed.

"Mobilizing the lottery in this way is revolutionary," he said. "Making it easier and faster for people to buy their tickets provides the lotteries with the opportunity to generate additional revenues from lottery ticket sales."

Exact details of the agreement weren't disclosed, but Valista did pay a "small" licensing fee according to company officials. The company said it could see additional revenue down the road once GTech implements the service for its global clients.

Valista vice president of marketing John Hurley told IGN that having a notable partner like GTech in the fold will allow his firm to expand its horizons into other markets.

"We aren't really concerned with what markets we are in, but interactive gaming certainly has some uniqueness to it," he said. "We have proven that we can address those subtleties for the lottery industry and hopefully we can leverage that into other areas of gambling and e-commerce."

Hurley said a report from Juniper Research showed that a large area of future growth for lotteries and I-gaming would be through mobile means.

That report said that by the end of 2007, the world market for mobile gambling will exceed EUR16 billion and charitable lotteries should account for a full one-third of the market.

If the market lives up to that billing, the deal could be a very lucrative one for Valista, Hurley said. GTech has more than 54 billion transactions a year in lottery sales around the world. The mobile rollout, he said, will be dependent on how quickly licensing jurisdictions around the world adopt the mobile delivery system.

GTech is involved in the running of over 85 lotteries around the world, including Ireland, and processes more transactions a year than MasterCard, Visa and American Express combined, the company said.

"This is the ideal setting for Valista's software," Hurley said. "Buying lottery tickets are lifestyle transactions. They are purchased regularly by people and they are a low-cost purchase -- just right for mobile devices."

Although the deal is the first for Valista with a powerhouse name in the lottery industry, it isn't its first partnership with a major international brand. Hurley said the company has the likes of Vodafone and major mobile carries in Japan among its partners.

"Mobile devices lend themselves to sponsorship of games and represent another revenue channel for the provider," he said. "We have those relationships already established and are in a good position to leverage them."

Valista was formed last year when Network365 merged with iPin, forming a mobile payments infrastructure company with more scope and a wider array of products.

The company's technology consists of a platform through which mobile operators and other firms can deploy mobile commerce applications, allowing customers to make what in the short term are likely to be small transactions such as purchases of flowers, tickets, content, books or CDs.

"Something as simple as a $2 play for a lottery ticket fits right into what we have already built for our other clients and partners," Hurley said. "Mobile devices are the perfect fit for someone wanting to splurge on a lottery ticket after they see an ad for the jackpot during their commute home or at a sporting event."

The gaming industry does offer some unique obstacles though for a company like Valista, Hurley said.

"The challenges are very localized in gaming because of the jurisdictions," he said. "I am hopeful this deal will open up doors. We offer new channels and new ways to play and new levels of playing."

Hurley said mobile devices could also be used to increase security on games too. Players can be asked to authenticate themselves more frequently, and with greater ease, over the mobile phone, compared to other traditional interactive gaming channels.