E-pulltab gambling aims to lure players, boost revenue, with new games

Nearly two years after Minnesota debuted electronic pulltab gambling, the games as introduced are going away.

The old versions never quite caught on. E-pulltab gambling failed to pay out the big profits it promised since it launched in 2012 as a financing mechanism for a new Minnesota Vikings stadium. Among the reasons the games never gained a foothold are the lack of changes needed to sustain gambler interest, a legal dispute that all but put the biggest supplier out of business and the fading support of a one-time booster, Gov. Mark Dayton.

"We're getting a lot of feedback from our customers, you know a lot of disappointment starting probably in the middle part of last year," said Jon Weaver, the founder of Express Games, the distributor that debuted electronic pulltabs in 2012.

But although the existing games are going away Aug. 1, they will receive a reboot that backers say may fix what ails the new industry.

For Weaver, says that's a good sign. Although Express Games has shut down in about a third of the bars where it used to operate, it still accounts for more than four out of five e-pulltab bets, according to data from the Minnesota Gambling Control Board.

On Monday, Weaver's new company, Pilot Games, was licensed as a manufacturer of electronic pulltabs, not just a distributor. He's rolling out a fresh set of games next month, and will be updating hundreds of iPads in Minnesota bars.

Weave said charitable gambling operators, bars and gamblers will get e-pulltabs 2.0 as the industry starts its third year this fall.

E-pulltab useage, bet data 2012-2014

The new games will include Twitter notifications of new games and big wins, as well as a Facebook app that allows players to try the games at home without betting money, he said. The system will even feature a closed-circuit TV network, dedicated to e-pulltab games.

"Initially it starts out as being associated these weekly event, tournament games, but I think it has the ability to expand over time, and become something that's a great tool for charities to use as marketing," Weaver said.

Weaver isn't alone in looking for a fresh start After 22 months of a disappointing results, other industry players are hitting the reset button, reconfiguring their games, posting web developer jobs and hoping for a reprieve.

Tom Barrett, executive director of the Minnesota's Gambling Control Board, and said earlier this week that the business may be turning a corner.

"What we're seeing right now, is a number of manufacturers going back to the drawing board, the ones that are currently licensed," Barrett said. [They're] "retooling some of the games, get a little more interest. And we have new vendors coming on, And you look at those games, much more graphic, in terms of the playability, the interest."

The companies also are making it simpler for charities that offer the games to comply with state accounting regulations, he said.

Still, the games have a long way to go. By now, there were supposed to be more 15,000 machines across the state taking $225 in bets. That count has fallen below 1,000 and the games have bottomed out at about $50 of bets a day on average.

The state has mostly written off any contribution of the electronic games to the Minnesota Vikings stadium -- although an expected 5 percent uptick in paper games may actually be helping pay the state's stadium bill. Al Lund, executive director of Allied Charities, the trade group for charitable gambling providers, thinks electronic gambling is still the shape of things to come.

"At some point, somebody's going to get it figured out, and whoever does that, it will raise everybody's boats," he said.

But Lund thinks there's still one big obstacle in the way. That's even though Minnesota decided to earmark corporate taxes to pay the stadium debt more than a year ago, the project still looms large over the games.

"If you were to go out to a bar where people play pulltabs, and they didn't know who you were, and you asked them 'why aren't you playing electronic pulltabs or electronic-inked bingo,' eight out of 10 of those people will tell you that they are not going to fund a stadium," Lund said.