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The Italian gambling tender on the Lotto game is expected to be the most valuable for operators and is getting closer with the Italian gaming authority, ADM, that performed an essential step towards its award.
The Italian gaming authority, ADM, has sent the notification of the tender for the Lotto game to the Supreme Administrative Court, which will have a month and a half to give its opinion.
According to the press, it is therefore likely that the notification will be examined when the ordinary sessions resume on September 15, 2024. The final approval for the tender could then come between the end of October and the first days of November 2024, followed by publication in the Official Gazette of the Republic, allowing interested operators in the sector to submit their bids by the end of the year.
The Lotto tender is expected to the most challenging tender in Europe of the coming years with major operators that are interested to participate. Indeed, with a minimum bidding price of EUR 1 billion for a license of nine years, it appears that operators shall be ready to perform considerable investments as the expected award price might range between EUR 1.4 to 1.5 billion with the awarded entity that will be obliged to upgrade the technology of the network system and the gaming terminals according to quality standards that guarantee maximum security and reliability, in addition to the obligation to make annual payments to the Treasury of any sums not invested according to plan.
The license terms provide for a commission to the exclusive license holder of 6 percent of revenues, but the main challenge for operators will be to reinvigorate a game that is part of the Italian tradition but appears to be quite old fashion at the moment. However, the potentials are massive because of the large penetration of shops authorized to market the Lotto game that might become channels to cross sell other services, including payment services that have been de-invested by some operators but represent a major opportunity especially in a country were considerable payments still occur in cash.
Beside, the multi-channel strategy is not fully explored in Italy. Retailers marketing Lotto games might become a major source of online players, especially in market where the gambling advertising ban provides considerable restrictions to traditional marketing activities. And, in this contest, the exploitation of data collected from multiple sources about players to customize the offering and maximize their value is also a field where operators have not sufficiently invested.
All is happening in a period when the tender for new online gambling licenses is also happening in the coming months and the price tag per license of EUR 7 million will trigger a natural selection among operators with a process of acquisitions and mergers among operators that is happening during the last months. On this topic, you can find the following article interesting “New Italian Remote Gambling Rules Notified to the European Commission“.
