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Continued: Shake-up rattles Minnesota’s charitable e-gambling industry

“Pilot [Games] has developed the next generation of electronics,” the notice received by some charities said. “Pilot will of course have a whole line of electronic pulltab games, as well as provide linked bingo. … We are also developing new marketing tools to help you kick the industry into high gear.”

Charities said they were aware of the lawsuit but didn’t have a clue their games would be shut down.

“We knew something was coming, but I didn’t expect it to be the 31st of July,” said Genny Hinnencamp, gambling manager for Irving Community Charities in Duluth, which operates six e-pulltab sites.

Not all of Minnesota’s e-gaming will be affected. About 100 bars and restaurants use e-pulltabs that aren’t from Acres 4.0, Barrett said. However, the Acres games generate the overwhelming amount of sales.

Shifting gears, new players

John Acres, CEO of Acres 4.0, said he will be shifting gears in Minnesota. “We will focus for now primarily on casino activities,” Acres said in an e-mail. “The electronic pulltab market suffers from a lack of coherence about the way forward.”

Other changes are coming.

• A manufacturer has submitted an application to the Gambling Control Board to purchase the Acres 4.0 system, Barrett said. The application has not yet been approved.

• The Woolton Group, based in Florida, was approved to distribute Acres 4.0 games. No contract has yet been signed.

• Colin Meinhart, former director of the children’s fund of the Minnesota Licensed Beverage Association, became a licensed sales representative for the Woolton Group this week. Meinhart said he spent Thursday with the group intending to buy the Acres system.

The behind-the-scenes flurry of activity concerns Drew Naseth, a veteran Faribault, Minn., gambling equipment distributor.

“Is anyone minding this for the charities?” Naseth asked. “Why are we willing to keep things so quiet?”

The Gambling Control Board is “mindful of the impact” that the changes have on e-gaming, Barrett said. But he, like others, sees it as the growing pains of a young industry.

“We all learned in the past two years what’s working and what’s not,” said Barrett.

Al Lund, executive director of Allied Charities of Minnesota, said despite the confusion, he’s heartened that e-gambling investors are still looking at Minnesota.

“At some point, someone will figure out how to do this so charities can make money, and the state can make money,” Lund said.

 

Jean Hopfensperger • 612-673-4511

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