Manitoba's gambling website could hurt economy, critic says

An online gambling site launched by the Manitoba government to keep revenue in the province could backfire, as players may skip the site's smaller winnings in favour of bigger payouts on offshore sites, critics say.

PlayNow.com could end up hurting Manitoba's economy in the long run if users move on to other sites, therefore funnelling more money out of the province, says Robert Williams, an expert in gambling economics and addictions with the University of Lethbridge.

"It's not serving the people well if it does something that compromises the economy of the jurisdiction," said Williams, who is also a research coordinator with the Alberta Gambling Research Institute.

Manitoba Lotteries launched PlayNow.com in January, in an effort to compete with popular online gaming sites where Manitobans were already spending their money.

Lotteries officials say Manitobans have spent upwards of $40 million a year on unregulated international gambling websites.

PlayNow.com is expected to generate $1.5 million in its first year and upwards of $17 million by 2018, according to officials.

"It's going to be a slow and steady growth over years," said Andrea Kowal, Manitoba Lotteries' director of corporate affairs.

Manitoba Lotteries teamed up with the British Columbia Lottery Corp., which has been operating its own gambling website for several years, to bring PlayNow.com to the province.

'It's almost embarrassing'

Zenni Petros, 25, plays online poker full-time — he plays multiple games at a time for three to eight hours a day — and was one of the approximately 4,000 Manitobans who registered with PlayNow.com in its first month.

But Petros says he won't stay with the province's gambling website much longer, citing its meagre winnings.

"It's almost embarrassing … compared to the biggest site online," he said.

"I understand them, obviously — they just couldn't do it. But the bonuses are pretty small to even attract anybody to a new site."

A look through PlayNow.com shows winnings of up to $30,000, while popular offshore gaming sites like Poker Stars offer payouts of up to $1 million.

In terms of site traffic, PlayNow.com shows hundreds of users logged in at any given time, compared to hundreds of thousands of people on popular international sites.

U.K. gamblers went to other sites

Williams said in the United Kingdom, which legalized online gambling years ago, people were initially drawn to government-operated gaming websites because they are deemed to be legal and safe.

However, those players quickly moved on to the bigger jackpots that the offshore sites were offering, he said.

"What happened is that only 25 per cent of the domestic market was captured in the U.K. They have lots of very good domestic online providers, but three-quarters of the action went offshore," Williams said.

"So now, $3 billion is leaving the jurisdiction, as opposed to $1 billion previously."

But Kowal said she doesn't buy the argument that government-backed websites are making the online gambling market expand more quickly.

Kowal said the fact is that the internet is growing, anyway, and more people are going online these days for a variety of purposes, from shopping to gaming.

"I really hesitate to confirm that the fact that there's legitimate gambling sites is the reason that the market is growing, necessarily," she said.