In the United States, there are currently only a handful of states that allow residents to purchase lottery tickets online. The rules and regulations surrounding online lottery sales vary by state, with some states prohibiting online sales altogether while others have opened up limited opportunities to purchase lottery tickets via the internet or mobile apps.
States That Allow Online Lottery Ticket Purchases
Here is an overview of the states that currently allow online lottery ticket purchases in some form:
Illinois
Illinois was one of the first states to allow online lottery ticket sales. Since 2012, Illinois residents have been able to use the state lottery’s mobile app or website to purchase tickets for pick-3, pick-4, lotto, mega millions, and powerball games.
Georgia
Georgia launched online lottery sales in 2012. Georgia residents can use the Georgia Lottery’s website or mobile app to purchase tickets online for games like Cash 3, Cash 4, Fantasy 5, Mega Millions, and Powerball.
Kentucky
Kentucky’s online lottery sales started in 2016. Kentucky Lottery players can use the lottery’s website or mobile app to purchase tickets for pick-3, pick-4, Cash Ball 225, Mega Millions, and Powerball games.
Michigan
Michigan was another early adopter of online lottery sales. Since 2014, Michigan Lottery players have been able to purchase lottery tickets online for games like Lotto 47, Mega Millions, Powerball, Daily 3, Daily 4, Fantasy 5, and Keno.
New Hampshire
New Hampshire launched online lottery ticket sales in 2017. Players can use the New Hampshire Lottery’s app to purchase tickets for Mega Millions, Powerball, Megabucks Plus, Pick 3, Pick 4, Gimme 5, Fast Play games, and more.
North Carolina
North Carolina started offering online lottery ticket sales in 2019. Players can use a mobile app to purchase tickets for Carolina Pick 3, Carolina Pick 4, Powerball, and Mega Millions.
Pennsylvania
Pennsylvania’s lottery began selling tickets online in 2018. Pennsylvania players can use the state lottery’s app or website to purchase tickets for scratch-off games and draw games like Powerball, Mega Millions, Treasure Hunt, Cash 5, Match 6, PICK 2, PICK 3, PICK 4, PICK 5, and more.
Virginia
Virginia also jumped on board with online lottery ticket sales in 2020. Virginia Lottery players can now purchase tickets online for games like Pick 3, Pick 4, Cash 5, Mega Millions, and Powerball.
States Where Online Lottery Ticket Sales Are Prohibited
While the list of states allowing online lottery ticket purchases is growing, the majority of states still prohibit online lottery sales. Here are some of the states that currently do not allow any form of online lottery ticket purchases:
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Hawaii
- Idaho
- Indiana
- Iowa
- Kansas
- Louisiana
- Maine
- Maryland
- Massachusetts
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Jersey
- New Mexico
- New York
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Washington
- West Virginia
- Wisconsin
- Wyoming
The reasons these states prohibit online lottery sales vary. Some simply haven’t passed legislation to allow for online lottery ticket sales or have legal restrictions in place. Other states may feel that making lottery tickets available for online purchase would increase problem gambling rates or be difficult to regulate. Many states are taking a cautious approach as the area of online lottery sales is still somewhat uncharted territory.
The Legal Landscape of Online Lottery Tickets
When it comes to online lottery ticket sales, states have to navigate a complex legal landscape. Important laws and judicial decisions that have shaped the current status of online lottery sales include:
The Wire Act
This federal law enacted in 1961 prohibits interstate sports betting via wire communications like telephone and telegrams. Some legal interpretations extended the Wire Act to other forms of interstate gambling, which slowed state adoption of online lottery sales.
UIGEA
The Unlawful Internet Gambling Enforcement Act of 2006 prohibited online gambling businesses from knowingly accepting payments related to illegal gambling activity. However, it provided carve outs for intrastate online gambling transactions, which paved the way for states to start allowing limited online lottery ticket sales.
DOJ Reinterpretation of Wire Act
In 2011, the Justice Department reinterpreted the Wire Act to only apply to sports betting, not all forms of gambling. This opened the doors for states to regulate online lottery products without running afoul of federal law.
Supreme Court PASPA Ruling
In 2018, the Supreme Court struck down PASPA, the federal ban on sports betting, ruling that it was unconstitutional. This gave states more authority to legalize and regulate other forms of online gambling like lottery games.
While federal laws once created roadblocks, the shifting legal interpretations and precedents in recent years have given states much more leeway in authorizing online lottery sales if they so choose.
Arguments For and Against Online Lottery Sales
The debate over whether states should permit online lottery ticket sales involves weighing several potential pros and cons:
Potential Pros
- Increased revenue and funds for state programs funded by lottery proceeds
- Expanded access and convenience for lottery players
- Appeal to younger, tech-savvy lottery players
- Reduced fraud risk with digital sales tracking
- Less reliance on brick-and-mortar retailers
Potential Cons
- Possibility of increased problem gambling and addiction
- Less in-person validation of age restrictions for lottery purchases
- Cybersecurity risks like hacking of lottery accounts or sales systems
- Erosion of retail lottery ticket sales
- Need for strong digital age and identity verification processes
Those in favor of expanding online lottery ticket sales point to the potential revenue benefits and the fact that it gives players another secure and convenient option. Opponents worry it could open the door to underage gambling and problem gambling issues if not properly regulated.
Outlook for the Future
The number of states allowing online lottery ticket sales is expected to grow in the coming years. Key factors that will likely influence this include:
- Success of early adopter states – Results in states like Illinois and Michigan will impact decision-making.
- Changing attitudes toward online gambling – Acceptance of online lottery play appears to be growing.
- Mobile technology advancements – Improved geolocation and biometric ID capabilities could alleviate verification concerns.
- Need for increased lottery revenue – More states may see online sales as an important revenue source.
- Competition with third-party courier services – States allowing sales through couriers may feel pressure to authorize online sales.
While universal nationwide online lottery ticket sales are unlikely in the near future, the list of states taking their lotteries online will continue to expand. This will make buying a lottery ticket from a computer or phone a reality for a growing number of Americans.
Regulating Online Lottery Sales
For states that wish to start selling lottery tickets online, establishing effective regulations is crucial. Some key regulatory considerations include:
Geolocation and Geo-Fencing
Requiring accurate location verification ensures only ticket sales within state lines. Geo-fencing can block sales activity from unauthorized locations.
Identity and Age Verification
Rigorous registration procedures and biometric scans during account setup can help confirm identities and block underage purchasers.
Responsible Gambling Features
Usage limits, self-exclusion options, and problem gambling resources can help mitigate risks.
Cybersecurity Standards
Mandating steps like encryption, firewalls, and vulnerability testing makes systems less susceptible to attacks.
Auditing and Reporting
Robust sales and transactions monitoring enables oversight and investigations when needed.
Retailer Compensation
Ensuring brick-and-mortar retailers receive commissions on online referrals and sales protects that channel.
As more states implement online lottery sales, shared regulatory standards and best practices will likely emerge. But each state will need to craft an oversight approach fitting its specific legal and policy landscape.
Online Lottery Sales Models
States have a few different options in terms of how they structure the sale of lottery tickets online:
State-Run Online Sales
The state lottery or gaming commission directly handles online lottery sales through their own online portal or mobile app.
Retailer Online Sales
Authorized retailers sell lottery tickets through their own websites and mobile apps.
Third-Party Courier Model
Third-party courier services buy tickets via retail terminals and then deliver scanned copies to customers.
Multi-State Online Games
Groups of states band together to offer joint online lottery games.
Each model has different pros and cons for consumer convenience, security, profit potential, regulation, and impact on in-person retail sales. Many states will likely utilize a hybrid approach incorporating multiple online ticket sales channels.
Notable Online Lottery Sales Controversies
The rollout of online state lottery ticket sales has not been without controversy in some instances:
Michigan Data Breach
In 2020, personal data for around 1% of the Michigan Lottery’s online users was exposed in a cyberattack. The breach demonstrated the need for strict cybersecurity measures.
Jackpocket Investigation in New Hampshire
New Hampshire investigated third-party ticket courier Jackpocket for possible non-compliance with state rules. Complex regulations for ticket couriers remain an issue.
Virginia Sales Delay
After legislation passed, Virginia experienced delays in implementing online sales due to vendor acquisition and system integration challenges.
Illinois Anti-Competition Lawsuit
When Illinois wanted to allow people to buy tickets online in 2012, local retailers sued the state lottery for anti-competitive practices over fears of losing in-person sales. The retailers ultimately lost the lawsuit.
As more states navigate the unique challenges of implementing an online lottery sales presence, disputes and complications will likely continue to emerge before more standardized best practices take hold.
Conclusion
Online lottery ticket sales represent an area of rapid change and innovation in the gaming industry. While still limited to less than a dozen states so far, the option to purchase lottery tickets over the internet or via mobile apps seems poised for wider adoption across the U.S. in coming years. With careful attention to responsible gambling protections, verified age restrictions, transparent auditing procedures, retailer compensation models, and strong technical safeguards, states can potentially reap the benefits of expanded online lottery sales without incurring substantial new risks. But as online lottery sales continue to evolve, states will need to remain agile and responsive in shaping regulatory approaches that serve the public interest while maximizing revenue for vital state programs.