Skip to main content

out come the spin doctors for Tabcorp

Australia's biggest betting company, the once government-owned and still heavily protected by said powers, Tabcorp, are pushing out the tripe to rub Betfair and corporate bookmaker's noses in it after the Racing NSW v Betfair court ruling yesterday. How about this piece of tripe from Sydney's biggest daily paper, masquerading as Tabcorp's weekly newsletter, the Daily Telegraph.

Racing bet case bonanza for NRL

The NRL could receive a $17 million a year windfall - or $1 million-plus per club -following a landmark court ruling on Wednesday in favour of Racing NSW.

Racing NSW had their right upheld in the Federal Court to charge all betting agencies and corporate bookmakers 1.5 per cent of their turnover as the price for allowing them to bet on their product.

The decision has given the NSW racing industry an instant $120 million payday from money already collected but so far held in a trust account. It will also earn the body $50 million a year in future revenues.

But the decision will have ripple effects well beyond racing. It creates a precedent that will almost certainly bring a multi-million dollar windfall to the country's major sporting codes - including rugby league, AFL and cricket. These may now all look to put their own 1.5 per cent turnover levies on the betting agencies.

It sounds perfectly logical to people who have no idea about the economics of betting but the reality is horse racing and rugby league as betting events are poles apart.

Horse racing, particularly through the TABs, which this ruling heavily favours, operates on higher margins due to the number of competitors in each market. TABs take an automatic 16% (actually it varies between 14 and 25% depending on market type, but 16% is the average) of turnover from each market, with an average of about 10 runners, sometimes as many as 24 - but that % takeout never changes.

Betting on other sports revolves almost exclusively on head-to-head options, that is, Team A v Team B for the win, or on the handicap. All the exotic markets such as First Try/Goalscorer, HT/FT take very little in comparison. H2H markets are set to about 106% with no guarantee of winning - i.e. there are no pool bets with margin scraped off the top like racing at the TAB. Impose an exorbitant margin of 1.5% of turnover onto that market and that will wipe out 50% of bookies' profits for the year. Bookies won't absorb all of that, so inevitably it means punters will have to cop bad prices - instead of 1.9/1.9 for a close game, it may be as bad as 1.8/1.8, giving punters no chance of winning over the course of a year. It'd be like trying to play roulette with three zeroes on the wheel.

Don't forget that there are still legal avenues open to Betfair to take this further, and it is almost certain they will, although overturning the verdict without a fresh approach seems a longshot.

Two other points:

1. Bookmakers around the world now bet on NRL, AFL and various other Aus events. They won't be forced to pay anything, so punters seeking value will head offshore.

2. Racing is the only sport geared entirely around betting. Without funding from betting, it would collapse. Other sports survive without it. There is no compulsion for bookmakers in Australia to sign up to any agreement where they pay a share back to the sport. Several betting firms have signed deals with the AFL, NRL, FFA, PGA Tour Australasia etc, but purely so they can invest in sponsorship of that sport to gain customers. Chase a higher payment of levy, and that marketing budget will shrink faster than Kevin Rudd's approval rating.


Sports betting is now big business in Australia. Start imposing disproportional fees on it and there could be plenty of jobs lost. Betting must be about the third biggest industry in the Northern Territory after tourism and mining, not much else goes on there....

Comments

Popular posts from this blog

lay the field - my favourite racing strategy

Dabbling with laying the field in-running at various prices today, not just one price, but several in the same race. Got several matched in the previous race at Brighton, then this race came along at Nottingham. Such a long straight at Nottingham makes punters often over-react and think the finish line is closer than it actually is. As you can see by the number of bets matched, there was plenty of volatility in this in-play market. It's rare you'll get a complete wipe-out with one horse getting matched at all levels, but it can happen, so don't give yourself too much risk...

Racing has a Ponzi scheme - and the fallout will be enormous

When the term 'Ponzi scheme' is mentioned these days, the names Bernard Madoff and Allen Stanford instantly spring to mind. The pair of them ran multi-billion dollar frauds (US$60bn and $8bn respectively) that destroyed the lives of thousands of investors who had put their life savings into a 'wonderful' investment strategy. How so many people were sucked into the scheme is baffling to those on the outside. The lifestyle, the sales pitch, the success stories of the early investors - I suppose it all adds up.

So where does this link to racing you ask? A prominent Australian 'racing identity' this week has been reported to have lost access to a bank account with punters' club funds of $194m in it. Firstly - is there a worse term for anyone to be labelled with that 'racing identity'? It ALWAYS ends up meaning shonky crook! Secondly - who the hell has a punters' club with an active bankroll in the tens of millions? It simply can't be done.

The…

damage control when trading goals

When trades go bad, some people will say cut your losses immediately, others will recommend having a bit of patience as events tend to level out (i.e. games with two goals in the first 10 mins never end up with 18 goals in 90 minutes). This is something I like to do on certain matches.

Background:
1. You've backed Under 2.5 goals, trying to nick a few ticks at a time as the clock ticks.
2. You've been caught out by a goal.
3. The market has gone sharply against you.

On this particular match from a couple of weeks ago, there was an early goal (sixth minute) before I got involved. The period immediately after an early goal regularly shows a sharp drop in the Under price, so I was trying to capitalise on that. But Watford then scored again after 14 minutes. The Back price I took (3.95) was now out to 12 - I could close out for a big loss (not my style) or wait and wait for the price to come back to somewhere I could close out for minimal damage. But at 2-0 after 15 minutes, it w…