Opportunist’s Managing Editor Leslie Stone talks with Loto Inc.’s President and Chief Technology Officer Fulvio Ciano about his company’s new and secure mobile lottery solution for cell phones.
Smartphones are used for much more than making calls these days, especially when combined with functional apps that let you do everything from check your bank account to get directions. Now, thanks to Mobilotto, a wholly owned subsidiary of Toronto-based Loto Inc., users will be able to securely purchase lottery tickets and redeem their winnings via mobile phones anytime or anywhere.
Opportunist: What is your business background?
Fulvio: My background is in software development and technology. I have 15 years of experience in computer based video game development and online games in Canada and the United States. I also spent four years at various telecommunications companies as a technology officer and I was the CEO of a public telecommunications firm in Canada called Telehop. I joined Mobilotto in June and have been transitioning the company from development stage to deployment and commercialization.
Opportunist: Please tell us about the Mobilotto concept.
Fulvio: Mobilotto is a solutions provider for traditional lottery operators that want to move into the mobile base. This is a tremendous opportunity for us because of the number of mobile phones and potential customers. They are ready for the solutions and we are ready to help.
Opportunist: How so?
Fulvio: It enables users to securely play the lottery on their mobile devices by combining secure electronic transactions, game play, player registration and location verification. The other area of core competitive advantages is the people in our company. I was surprised at the maturity of the team and the experience and depth of knowledge about the industry.
Opportunist: What are the advantages of mobile delivery?
Fulvio: It’s cheaper and easier to operate. We tailor our business models to be easy to understand and implement, so we anticipate that existing players will buy more tickets.
Opportunist: Please tell us about the technology behind Mobilotto.
Fulvio: Our technology is very well architected and stable, and it provides a lot of features. We took into consideration a full vision of both the market and the needs of the users, as well as the jurisdictions and operators that would use the system to reach customers. Traditional lotteries require terminals in every convenience store. Mobilotto makes every customer a point of access. You don’t need thousands of locations or jurisdictions where customers can purchase a ticket. It also introduces a secure direct distribution channel between the authorized lottery license holder and the consumer, which reduces the reliance on traditional distribution methods and one-way communication channels.
Opportunist: How does the Mobilotto software work on mobile devices?
Fulvio: It’s very simple. For example, consumers will be able to download our app from their already available iTunes account or from the website of the lottery operator. They are also able to scan a QR code in an advertisement and then be directed to a site to download the app. The mobile device then becomes a point of sale, like having your own private terminal lottery device in your hand. You can, alternatively, send a message to a short code and you can register for the service, buy tickets, be notified automatically when jackpots reach different levels and so forth. The concept appeals to regular lottery players or those who want to buy scratch-off tickets and want to do it more easily without visiting a retailer.
Opportunist: So, users can actually play scratch-off tickets on a handheld device?
Fulvio: Yes! The application matches the look and method of real lottery offerings. Using a touch-screen, for example, users would simply rub their finger across the screen to reveal an image below.
Opportunist: How do consumers pay for their mobile lottery tickets?
Fulvio: There is an array of payment platforms. It really depends on the jurisdiction. Some allow credit cards and some don’t. Users might be able to go to the point of service and buy a $10 top-up type card with numbers that they type into their phone—and now they’ve got $10 to play with. Another option is player registration with stored value options that they would set up and use to play a designated amount each time. It will vary in different parts of the world, but whichever is easiest, fastest, safe and secure is what we are aiming for.
Opportunist: What are some additional benefits?
Fulvio: Mobilotto can verify the location of a mobile device at the time of purchase, thereby restricting out of jurisdiction purchases where those are prohibited.
Our technology integrates another technology called geo-location, which allows the identification of the real-time geographic location of a mobile phone user. Regardless of whether it’s a GPS-enabled phone or not, we can ascertain whether a phone is currently in a particular jurisdiction.
Opportunist: Can anyone from anywhere buy a Florida Lottery ticket, for example?
Fulvio: That’s really up to the jurisdictional operator and many usually have parameters under which they sell tickets. Some will let you buy while you’re physically in the state and others want you to also be a resident of that state.
Opportunist: Can Mobilotto track individual users?
Fulvio: Mobilotto can identify and qualify players by age, by reference to mobile telephone subscription, passwords and other methods. The system also eliminates lost tickets, which is a major issue for lottery operators. In the event they lose their cell phone, the ticket is still registered.
We support responsible gaming conventions and allow lotteries and players to set limits on game play.
Opportunist: What about parts of the world where the general population doesn’t have smartphones?
Fulvio: The system can be deployed from just about anyplace with a cellular phone network. If the Internet or smartphones are not widely available then SMS features of our system can be used to service customers easily. This is very good in areas without smartphones; users will be given a number to send messages to and will receive text messages on how to play.
Mobilotto could add jobs and generate revenue in jurisdictions in other parts of the world where a traditional lottery system hasn’t been economically feasible for them or they don’t have convenience store networks like 7-Eleven, etc.
Opportunist: Are you targeting specific demographic groups?
Fulvio: Mobilotto appeals to 25- to 35-year-olds who will play because the distribution method better suits their needs.
Younger people are used to looking up information on their mobile devices. Our distribution method appeals to them—we know that from surveys we have conducted.
Opportunist: Does Mobilotto pride itself on being socially responsible?
Fulvio: The current distribution systems for lottery games consume substantial amounts of paper. With Mobilotto there is no need to ship paper scratch cards around or return them for validation. Also, traditional lotteries offer no real benefits to the participant besides the chance to win. Mobilotto practically eliminates the point of service and operating costs and lets the lottery return more to the charitable good that they do.
Opportunist: What is your competition?
Fulvio: There aren’t a lot of competitors because mobile lottery is still a developing market. Few jurisdictions have finished taking the steps to be in the marketplace. We are really in the new frontier.
It’s clearly an industry on the verge of coming into the mainstream and it is undergoing a maturation process much like the video gaming industry. There are about three non–public competitors who have SMS based or WAP based systems to facilitate the sale of lottery tickets via mobile devices, in China, Mexico and Finland, the two latter of which have no independent settlement functionality.
Opportunist: Is the United States ready for mobile lottery systems?
Fulvio: The United States is quite a ways behind in terms of looking into this and is cautious at best. Some states are starting to take a look at this technology and distribution capability; however, the United States has never been on the forefront of gaming and changes to gaming, primarily because of the way the political process works. There is more incentive to move forward as other parts of the world adopt online gaming. So, I believe the United States is beginning to see the benefits and the need to generate more revenues for jurisdictions, for operators, etc.
Opportunist: Tell us about a typical day at the company.
Fulvio: Product development and sales and marketing are the vast majority of our daily activities. A certain number of people are engaged in testing and implementation and there’s a lot of activity around presentations to lottery operators wherein we explain the benefits of mobile lottery.
The industry seems to be moving suddenly and I would say we are significantly busier this month than we have been in the past. We are responding to an avalanche of requests for proposals, and we have deals that we are in the process of closing.
Opportunist: How long has the company been trading on the OTC Bulletin Board?
Fulvio: We have been a public company since late-2009. We took the public route, firstly, to raise capital, which we will do eventually and, secondly, to provide liquidity for our shareholders. You have to be very transparent and disclose a lot of information when you’re in the lottery business. We felt that being on the public exchanges would be a way to legitimize ourselves with the governments so they would see what we are doing and that our filings are always up to date. That’s a key consideration in going public.
Opportunist: What are your expectations for the stock?
Fulvio: We all wish we had a stock Ouija board or a crystal ball. [Laughs] Our eyes are currently on the Toronto Stock Exchange, and we are also registered on the Frankfurt Stock Exchange. We’ve been around for two and a half years and in that time we have made significant progress. I’m proud of that.
Leslie Stone is an award-winning writer/editor with more than two decades of experience covering business, finance and lifestyle issues for newspap
ers, magazines and online publications.
