The threat to traditional lotteries posed by controversial disrupter Lottoland is "dissipating", analysts now believe, following a powerful campaign urging state governments to ban betting on lottery outcomes.
But Lottoland Australia's chief executive, Luke Brill, insists the lottery-betting service's growth remains "phenomenal", and has hinted at an advertising blitz coinciding with the Australian Open tennis.
Lottoland has been under sustained attack in recent months, with governments in several states flagging plans to restrict digital services that allow punters to bet on the outcomes of Australian lotteries and higher-value overseas lotteries without buying a ticket in the draw.
It came after newsagency groups and lotteries giant Tatts waged a campaign throughout the year claiming Lottoland's "synthetic" lottery service was cutting into their livelihoods and eroding tens of millions of dollars in taxes that would otherwise have paid for schools, hospitals and roads.
The campaign, dubbed "Lottoland's Gotta Go", includes newspaper and television advertisements, and posters in newsagencies Australia-wide.
"In our view, these recent developments may impact Lottoland's Australia business ... and may also deter entry from other secondary lottery operators or products," Macquarie Research analysts David Fabris and Max Vermunt said.
"Domestic disruptions are dissipating."
Lottoland, in a major concession last month, agreed to stop taking bets on Australian lotteries, and now offers wagers only on foreign lotteries.
"This wasn't our desired outcome," Mr Brill said.
"We didn't want to give it away, but we had to make some concessions when dealing with the various levels of government."
But Mr Brill was upbeat about the prospects for Lottoland, which has amassed a customer base of more than 600,000 Australian punters in about 18 months.
Lottoland had been bracing for a 30 per cent drop in revenue after withdrawing from Australian lottery betting, Mr Brill said, but the decline had been far smaller, "about 10-15 per cent".
"It's been a phenomenal year of growth, despite the headwinds we've encountered in the last quarter," he said.
"Our targets next year are still looking for substantial growth in the new year, and we are coming out firing with a new marketing campaign to launch at the beginning of January.
Of the upcoming advertising blitz, Mr Brill promised: "You won't miss it ... especially if you watch the tennis."
In a report about the outlook of the newly merged $11 billion Tabcorp-Tatts gambling giant, Macquarie Research said it considered lotteries to be the "most attractive" division of the new company's business, which runs wagering and media, lotteries, Keno and gaming services across Australia.
The analysts' reasons included the "stable and predictable" revenue growth of lotteries, and the "improving operating environment through regulation on secondary lottery disrupters like Lottoland".