Are arcades opening up a new market with Lotto products?

Gaming arcades have had a tough time in recent years. There are various reasons for this. One is the Corona crisis. The arcades were forced to close. And they were only allowed to reopen late. This resulted in a drop in sales. Aid was not always paid on time. And as if the pandemic wasn't enough of a challenge, a new State Gambling Treaty came into force in July 2021. This stipulates that online gambling with slots will be permitted in the future. Of course, any provider will need a license. But in principle, that's just a formality. This means that competition for local arcades is growing.

Are arcades opening up a new market with Lotto products

But Covid-19 was not the first step in the arcades' dilemma. Even before that, states, cities, and municipalities wanted to reduce the number of gaming arcades, in some cases drastically. For this reason, minimum distances were introduced and have now even been enshrined in law. The permitted distance between two arcades is between 100 and 500 meters. This alone has forced many operators to close down their businesses - based on a quantitative and not necessarily a qualitative decision. However, Georg Stecker of the Verband Die Automatenwirtschaft has brought a new line of business into play - lottery products. Can the arcades tap into a new source of income thanks to Lotto?

Where are land-based arcades headed?

Let's take a look at a time before the pandemic. Because in 2019, the German gaming machine industry came up with a turnover of 6.1 billion euros. In 2021, we're long out of lockdown. But the estimated turnover is still only around 3 billion euros. There are many reasons for this. Of course, Corona still plays a role in people's minds. But this fact multiplies with the release of online gaming arcades. Since July, providers on the Internet have been allowed to hawk at least slot machines. That is an intersection 100% with the land-based arcades. And if you don't dare to go to the arcade because of Corona, you can quickly find a substitute online, for example at

Are arcades opening up a new market with Lotto products

Which only touches on the dilemma. Online gaming arcades are not yet licensed. Gambling protectors are already criticizing that this also means that customer protection is falling by the wayside. The gambling authority will not be fully operational until 2023. Until then, the competencies lie with the individual federal states. So it is not that there is no regulation. But, likely, this is currently not applied uniformly and perhaps not even to the same quality standard. While control in land-based gaming arcades would be ensured by qualified personnel, online gaming arcades are still hanging in the balance a bit - if only because of the lack of licensing.

Is Lotto, of all things, the way out of the arcade crisis?

Georg Stecker has brought it up. Because in Hessen, it is already possible, as the strong man of Die Automatenwirtschaft says: "As in Hessen possible we demand to be able to offer legal offers under a roof. Why should it not be sold in legal, proper arcades with an access system from a ticket of the state lotteries?" The question remains whether customers are willing to fill out their lottery tickets in an arcade. This is because arcades usually have very different entry controls than a pure lottery retailer. However, it is guaranteed that youth and player protection is guaranteed there. Therefore, from the point of view of the matter, there is nothing to prevent lottery games from being offered in gaming halls.

So what are the chances that slot machine players will also fill out a lottery ticket on a whim? Certainly, this possibility exists. And if there is an arcade nearby but not a lottery retailer, it is also worthwhile filling out the lottery ticket there. On the other hand, it may go through rather as a small discharge for the gaming houses. The economic rescue is it rather not. It also remains to be seen how many lottery players will bother to play the lottery in an arcade because of the access system.

Advantages and disadvantages of lotto in the arcade

Let's start with the advantages. For the players, there is another possibility to place their ticket. Operators open up a new source of revenue. And the lotto country offices would have a new distribution channel. But so far, Lotto in arcades is only allowed in Hesse. Once again, since the arcades even operate with admission controls, player and youth protection is even better here than at classic lottery retail outlets.

There are also disadvantages. The aforementioned retail outlets are getting competition. If players decide to take advantage of the offer, some outlets may be forced to close. If the arcade customers do not use the Lotto offer, it is an unnecessary and possibly costly effort on the operator's part.

First, however, it remains to be seen whether Lotto in arcades will become established at throughout Germany.