Story As It Appeared in the Houston Chronicle
Mega Million Sales to Fall Short by $152 Million
Posted: Wednesday, June 9, 2004
Revised: Oct 27, 2006 - Added link to SAC students new website
Professor Gerald Busald's Students Give
Current "True Value" Of Lottery Games
A new, very informative web site - compliments of San
Antonio College students. Very Interesting. Click here.
(This link added 10-27-06)
Read a really cute Mega-Q story that ran in the
Newport News (Virginia paper) on 6/11/04, click here.
Study says Texans smart in Lotto ways
By JOHN W. GONZALEZ
SAN ANTONIO -- Picture a stack of copy machine paper 8.5 miles high. On one -- just one -- of those sheets of paper is a set of winning numbers.
Now imagine how difficult it would be to pick that one page out of the stack on a single try. That's what it's like trying to win the 11-state Mega Millions lottery game, whose top prize carries the staggering odds of 1 in 135 million.
So goes the lesson taught to statistics classes at
Their conclusion: Texans are among the smartest because they spend the least per capita. But rather than deliver their finding as a cold statistic, they came up with "Mega-Q" to give it more impact.
"We don't spend nearly as much as New York and some of the other states," said student Frank Rodriguez, who said he was amazed to learn about lottery odds.
"I never knew how much of a long shot it really was. Think of that stack of papers 8 miles high, and picking one of those papers. There's virtually no way that you're going to win any of that -- nothing, ever," Rodriguez said.
The premise behind the spring semester exercise was that "Mega Millions spending is not the most intelligent use of money, given the 1 in 135 million chance of winning the jackpot," said Professor Gerald Busald, a longtime Texas Lottery critic. Busald and some of his previous math students have campaigned successfully for significant changes in the way odds are disclosed to the public.
"The thing that is different about this one is, we didn't say they made any error. We're just pointing out something," Busald said Tuesday.
"We're finally realizing that when you have such a tiny chance of winning, you're throwing your money away. There's better things to spend a dollar on," the professor said.
Although Texas has the fourth-highest ticket sales among the 11 Mega Millions states -- behind New York, New Jersey and Illinois -- Texans still were among the smartest, the students concluded. On a per capita basis, during the first six months of Mega Millions in Texas, only residents of Washington spent less on the game than Texans, the students determined. New Jersey residents and New Yorkers rated lowest on the students' intelligence scale because of their high per capita spending.
In the six months ending June 1, Washington residents spent $4.78 apiece on Mega Millions, while Texans spent $5.38. For comparison, residents of New Jersey spent $15.05 and New Yorkers $13.28 -- all for what the students determined to be a poor wager.
Residents of Georgia and Michigan also got low Mega-Q ratings because of their relatively high spending, while Virginia, Illinois, Ohio, Maryland and Massachusetts had moderate ratings.
Busald said Texas even shows its smarts when jackpots swell to tens of millions of dollars. While most other states record large spikes in sales, Texas' sales have been relatively stable, Busald said.
"In Massachusetts, when the jackpot gets large, they spend more. Therefore, their Mega-Q goes down. On the other hand, Texas and Washington, when the jackpot gets large, don't get all shook up at the same rate those other states do, so their relative Mega-Q goes up," Busald said.
"New York and New Jersey, they just pour all their money in there all the time," he said. "Over a third of the sales are from those two states."
Per capita Mega Millions sales in the six months ending June 1, 2004.
States Mega-Q Rating
Congratulations Players ...
sales by state
Compare MegaMillions sales to Powerball sales. Click here.
Lotto Texas sales by draw.
Cash5 sales by draw/week
Texas 2 Step sales by draw & roll.
Texans Wiser than New Yorkers when it comes to
Sales to Fall Short of Predictions by $152 Million per Year
In overall lottery including Mega Millions, Texas ranks 21st in both sales per capita and profit per capita.
It seems especially appropriate that retired Virginia trucker J.R. Triplett came forward to claim a $239 million Mega Millions lottery prize on April Fools day.
The class, taught by Professor Gerald Busald, has a history of tracking lottery issues. They have tracked per capita spending by state for the first 52 drawings since Texas joined the game December 5, 2003. While residents in the eleven Mega Miliions states spent an average total of $9.59 each for the drawings, Texans spent only $5.38 and residents of Massachusetts spent $7.50. At the other end of the scale, New Yorkers spent $13.28 and New Jersey residents spent the most, $15.06 each. New York and New Jersey together account for over 1/3 of Mega Millions sales.
Using the premise that Mega Millions spending is not the most intelligent use of money, given the 1 in 135 million chance of winning the jackpot, the class developed the concept of Mega-Q, Mega-Q is basically an intelligent quotient for lottery spending. If a state has a per capita spending only half the combined average then the resulting Mega-Q would be 200 (Washington state's $4.78 versus the $9.59 national average yields a Mega-Q of 201). If, on the other hand, a state had a per capita spending of twice the national average, the resulting Mega-Q would be 50. New Jerseyites had the lowest Mega-Q, 64.
Residents of Ohio, Virginia, and Illinois all had Mega-Qs near 100. New Yorkers, on the other hand, have a Mega-Q of only 72 while Texans had a Mega-Q of 178. In worse news for Texas Lottery Officials, Texans Meqa-Q's have increased since the game was introduced and Texas seems poised to overtake Washington for the highest Mega-Q. In fact, for 7 of the last 15 drawings, Texans spent less per capita than any other state. Part of the explanation for Texas's high rating is that Mega Millions sales are only 61% of lottery officials forecasts (Megaplier sales, on the other hand, are even with forecasts).
Lottery officials had forecast Texans would spend $7.5 million per week (see La Fleur's Magazine, January 2004, Page 4) on Mega Millions tickets, but they have only spent $4.57 million per week, a shortfall of over $152 million per year.
One must be indeed fortunate to overcome the 1 in 135 million odds of winning the jackpot. For example, if one were to stack 135 million pieces of paper the pile would be more than 8 ½ miles high and if one were to count 135 million seconds it would take more than 4 ¼ years. Lotteries like to sell a dream, what one might do with all that money. Fortunately, you can have the same dream for $1 that you can for $10, $20, or even $100.
Other observations by the class are that players spend about $1.12 on the Friday drawings for every $1 they spend on Tuesday drawings. Also, sales do not increase at the same rate as the advertised jackpot for the advertised $230 million jackpot.
Rumor has it (note: see lottoreport.com) that Mega Millions officials are even considering making the Jackpot even harder to win so that the Jackpot amounts become even larger before anyone wins. In actuality, Mega Millions has been "lucky" that there have only been five jackpot winners since Texas joined the game, the probability was that there would have been eight winning tickets for the cumulative sales for the period. This would have decreased Jackpots and thus sales.
Other Info pertinent to Texas.
Governor Perry has proposed that Texas have Video Lottery Terminals (VLTs). There are currently 38 states and the District of Columbia that have lottery. The states that have VLTs have by far the highest sales per capita, because VLTs (and Massachusetts KENO online game that gives players a win or loss every 4 minutes) are arguably more of a casino activity than lottery. For example, Rhode Island has an annual sales per capita of $1,195, South Dakota $851. Delaware $765, and Massachusetts $652. (Source: North American Association of State and Provincial Lotteries (NASPL.ORG). Texas, on the other hand, has annual sales of $142 per capita.
However, high sales on these casino type games does not necessarily lead to correspondingly high profits. Rhode Island has an annual profit per capita of $225 (18.74% of sales) and Massachusetts has an annual profit per capita of $138 (21.19% of sales). Texas has an annual profit per capita of $43.19 ($30.51% of sales). Of the 39 lottery jurisdictions, Texas ranks 21st in both sales and profit per capita and 16th in profit percentage.
Another interesting fact. Keno is apparently much more addictive than Mega Millions. While Massachusetts folk spend much less per capita than New Yorkers on Mega Millions, they spend more than twice as much on lottery overall. A good portion of the difference can be attributed to Keno.
Another Story of Interest ...
The Lotto Report
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Garland, Texas 75049-5033
(972) 681-1048 Fax
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