From the Vancouver Sun on Sunday, February 21, 2010:
TORONTO -- Some lottery corporations across Canada are starting to place their bets on the once-underground world of online gambling, hoping that government-endorsed games will provide some credibility to the unregulated industry.
But critics say an industry that has led some players to lose paycheques, lie to their families and ultimately become consumed by addiction will be a high-stakes venture from which not everyone will emerge a winner.
“It’s our governments that are the most addicted to gambling,” said Dr. Jeff Derevensky, co-founder of the International Centre for Youth Gambling Problems and High Risk Behaviours at McGill University.
“They’re addicted to the revenue. There is no great social consciousness. This is a money-making operation, that’s quite clear.”
Loto-Quebec is the latest body to announce an online poker website, which will launch in the fall.
The lottery corporation expects this new site to counter the thousands of illegal gambling websites that already exist, and forecasts that it will make an estimated $50 million by 2012.
The gambling website will be launched in partnership with the Atlantic and B.C. lottery corporations, both of which already have their own online ventures.
The Atlantic Lottery Corp. has had an online gambling website since 2004, which allows players to purchase lottery tickets and try their luck at bingo. British Columbia offers online poker, letting players bet as much as $9,999 a week in games.
The website by Loto-Quebec will be available throughout the three regions, but it will be up to each corporation to cater it toward their province, according to an Atlantic Lottery spokeswoman.
These big bets will mean big profits for the corporations, said Derevensky, who estimates that the online-gambling industry is worth about $12 billion a year worldwide.
Despite this, other provincial lottery corporations are continuing to adopt a wait-and-see policy with online gambling.
“Nothing has been written off forever, but we have no plans to do that,” said Kevin Van Egdom, with the Western Canada Lottery Corp., which oversees gambling in Alberta, Saskatchewan, Manitoba, the Yukon, the Northwest Territories and Nunavut.
“We’re responsible for offering lottery games and selling lottery products through authorized retailers, where you buy them in person. Each region makes its own decision and Quebec’s doesn’t play into ours.”
It’s much of the same story at the Ontario Gaming and Lottery Corp., which has already spent a “considerable amount of time” investigating whether it wants to pursue online gambling.
“No decision has been made,” said spokesman Rui Brum, adding it will be up to the new board of directors, announced Friday, to decide if they want to go in this direction.
Nevertheless, Loto-Quebec points to Sweden as an example of a successful government-run online gambling operation.
That country has its own poker website and has captured an estimated 20 per cent of the online market there.
Even so, the idea of more government-backed gambling has not been embraced by everyone in Quebec.
Last week, provincial public health directors said the profits from this proposed venture were “minimal” compared to the risk that it could create as many as 100,000 new problem gamblers in Quebec in 10 years.
Derevensky said governments have a greater responsibility to the public to curb problem gambling and should set reasonable betting limits and monitor excessive gaming, especially online, where it becomes faceless and issues are harder to spot.
This responsibility comes from their automatic name recognition, and the public perception that their games are trustworthy and fair, he said.
“The question is: Can our government offer a better, safer game?” he said. “I remain cautiously optimistic.”
Derevensky cautioned this is particularly important for youth. His Montreal centre recently did a study and found that eight to 10 per cent of youth were at risk of developing a gambling problem — a rate that is at least double that found in adults.
“These kids get excited about playing. They dream about poker, about the hand they played, the hand they should’ve played, and what they could’ve done different,” he said.
"They start losing and try to catch up, get even, but they don’t stop. That adrenalin rush is very, very powerful and the sad part about that is that it comes whether you’re winning or losing.”
John Kennedy FitzGerald, the CEO of the Vancouver-based Interactive Gaming Council, hopes this is the first step toward national regulation of the industry and not an attempt by the government to monopolize the sector. Nevertheless, his group, which represents a number of major international gambling companies, said lottery corporations are more than welcome to place their bets.
“It’s a natural progression for governments to be more involved,” he said in Toronto.
“At least we have the government saying they recognize the industry and know it’s here to stay.”
By Lin Nguyen