Article

ATM, or lottery kiosk?

Triton Systems of Delaware hopes its new ATM will help deployers and lotteries by dispensing both cash and dreams.

November 28, 2010

In another effort to expand the business case for ATMs, one manufacturer is adding kiosk-like functionality to a new model that will enable it to vend lottery tickets.

Triton Systems of Delaware LLC is betting ATMs soon will become a key sales distribution channel for quick-pick lottery tickets. Next month, the Long Beach, Miss.-based company will begin manufacturing a new ATM that sells lottery tickets and dispenses cash.

Called Traverse, the ATM runs on the Microsoft Windows CE operating system. The machine's software communicates with software developed by linq 3 Technologies, a New York-based company that sells lottery tickets through ATMs, said James Philips, Triton's vice president of sales and marketing.

Once linq 3's software is installed inside the ATMs, cardholders can withdraw cash, play the lottery or do both, said David Tashjian, chief operating officer of linq 3. If a cardholder decides to play the lottery, linq 3's software generates the lottery numbers and prints the lottery ticket.

The software is capable of withdrawing funds from the cardholder's bank account to purchase the lottery tickets. The software also is PCI compliant. The software texts numbers that have been played, and it automatically pays winners below the reportable limit. Quick pick lotteries are Mega Millions and Powerball. These lotteries randomly generate numbers; players also can select their own numbers. The software does not dispense scratch-off lottery tickets.

Linq 3 developed the quick pick lottery software in conjunction with Nautilus Hyosung America Inc., which is based in Coppell, Texas. Last year, Nautilus Hyosung America displayed a Monimax 5000 CE machine that dispensed quick pick Lottery Tickets at the ATM Industry Association show in Miami. The machine was the hit of the show. Attendees stood three deep to see how the ATM operated.

In February 2010, Nautilus Hyosung said in a news release that linq3's quick pick Lotto software will be made available for use on Nautilus Hyosung CE models, which include the NH-1800 CE and NH-5000 CE. The linq 3 agreement made Nautilus Hyosung linq 3's vendor of choice, Nautilus Hyosung said on its website. The winter edition of Nautilus Hyosung's "Inside" newsletter displays a lottery-ticket dispensing ATM next to the linq3 logo.

That agreement, however, has not prevented Triton and Hantle USA Inc. from manufacturing ATMs that also dispense lottery tickets. A Hantle spokesperson could not be reached for comment.

"If all goes as planned, we will begin production in early December," Philips said. "We have pretty good demand. We have been talking it up to customers."

Individual state lottery commissions, however, must approve the sale of the lottery tickets through ATMs. Tashjian said the company is very optimistic about securing approval for pilots in states he declined to name.

In March, linq 3 got a big boost in that direction. The North American Association of State and Provincial Lotteries (NASPL), which represents 52 lottery organizations, named linq 3 as an official supplier to the lottery industry.

"Linq 3 Technologies serves the needs of state lotteries and their operators by enabling unmanned point-of-sale terminals such as ATMs, consumer facing card swipes (grocery, retail, etc.) and other terminals (airport, taxi, etc.) to distribute draw lottery (Mega Millions, Powerball, etc.)," the association said. "By leveraging the pre-existing footprint of these terminals, linq 3 is able to provide the states with a low-cost solution to accessing both increased distribution and a new consumer demographic."

The machines, Tashjian argues, will revitalize the lottery business. "The ATMs would give lotteries a new audience," Tashjian said. Lottery tickets are sold primarily in convenience stores and in bodegas through lottery machines, he said. With ATMs, lotteries can sell the tickets through ATMs deployed in restaurants and airports.

In August, linq 3 hired Thomas N. Shaheen, NASPL's former president and chairman, as vice president of business development. Shaheen was the first executive director of the North Carolina Education Lottery, and he worked with lotteries in Florida, Texas, Georgia and New Mexico.

ATMs that sell lottery tickets also would revitalize ATM ISOs. The companies have been looking for ways to increase revenues and transactions, Philips said.

A version of this story originally appeared on ATMmarketplace.com.