Ian Coss
speaker
45 appearances
1 recordings
1 series
first heard Feb 2025
last heard Feb 2025
Ian Coss’s voice in public audio — every appearance, attributed to the second.
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Appearances
Yes. To John Koza, our unemployed computer scientist, the... the potential of his game design seemed completely obvious. Like again, it was instant lottery, something that even the mafia could not offer their customers.
But this time, there was one place that was ready to hear them out. Massachusetts. Even better, the director of the Massachusetts lottery was not one of those FBI agents.
You know those kids still talk about that vacation and hate it, right, Ian? There's no way that was a good vacation.
But when John Koza was there, lucky for him, the PhD in computer science worked well for Dr. Peralt. He arrived in Massachusetts with his pitch for an instant ticket. Things seemed promising. You know, that man in charge spoke his language, combinatorics and all. And the people around him were eager to try something new. There was just one problem.
Yeah, quite bad for John. But he was convinced his ticket was better. You know, John had spent so much time making those supermarket scratcher tickets. He had seen the ways that people hacked those tickets at first. And he was sure that this other company, they could not have made a ticket as secure as his. There was no way.
After the break, how to hack a lottery with a can of Diet Citrus Soda. Now, the thing the Massachusetts lottery was worried about, the danger in starting a brand new instant lottery ticket, is that if that instant ticket had a vulnerability,
then any convenience store clerk with a stack of tickets might be able to figure out which ones of those are winners, which ones are losers, and then, you know, hand out the winners to friends, keep them for themselves, like just corrupt the whole system.
So, John Koza, back in Ann Arbor, he got to work. This other company's ticket was made of pretty thin paper with flap doors over the hidden numbers held down by glue. So John's goal was to see if he could reveal those numbers without visibly altering the ticket. That would be hacking the ticket.
This time, Dr. Peralt... great vacation giver. No, just kidding. This time, Dr. Peralt was waiting on the runway to greet them and carry their bags. Everybody convened at lottery headquarters, probably like half a dozen men in dark suits gathered around a conference table, eagerly awaiting this presentation from John.
A cystoscope has a tiny lens on the end of a thin, flexible tube. A doctor might use it to examine the inside of a patient's bladder, for example. John used it to peer underneath the ticket's flap doors.
Now, the average convenience store clerk probably does not have access to a cystoscope and may not have a copier in 1973. And so John presented his final foolproof technique. In a dramatic demonstration, John opened a bottle of Fresca, something you certainly could find in the average convenience store.
He poured the Fresca on the ticket and the glue, which was supposed to be the ticket's sacred seal, it simply let go. You could peel the whole thing apart, read the numbers, and glue it back together again.
Now, Ian, do we know why Fresca? Was it like what John had around? Was it an ingredient in Fresca? Like what is happening?
We're an economics podcast. We're not a science show.
The lottery canceled their existing contract and put out a new bid. John Coase's company, Scientific Games, won the new contract and their product, which used an indentation-free paper and, of course, that famous shiny metallic film. That became the world's first scratch ticket ever.
One liquor store owner described the scene as, quote, instant insanity. A pharmacy had to set up separate sales counters at the back of the store just for lottery tickets so that non-lottery customers wouldn't be disturbed by the apparently unruly crowds. Within a day, stores across Massachusetts had run out of tickets and were waiting to be resupplied.
Yeah, the other states had waited for someone else to take the plunge. But once they saw what was happening in Massachusetts, they jumped right in.
We now spend more on scratch tickets than we do on movie tickets, on concert tickets, on sports tickets combined. And the fact that the scratcher all started in Massachusetts, well, that is part of the reason that Massachusetts is spending more per person on average on lottery than anywhere else in the country.
So, Ian Koss, Massachusetts native. now lottery expert. How do you end up feeling about being from a home state that is like the scratch capital, being part of a state that spends way more on the lottery than any other place? Do you have a sense of pride in this? How are you feeling?
Sure.
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