Wednesday, 27 February 2013

another industry update

The month of February has been quite a busy one for the betting industry....

Sportingbet shareholders have overwhelmingly voted in favour of accepting the William Hill/GVC offer to takeover the online gambling giant. What does this mean for the Sportingbet brand - will it disappear or just become a 'William Hill' company in the website credits? Hard to say. Certainly in Australia, I think they'd be mad to change the company names or how the businesses (Sportingbet + Centrebet) too much. They are long established brands with profitable customer bases (for the firm). Sportingbet UK left them to their own and they ended making the lion's share of the group's profits. As for the UK and the rest of the world, I'm not sure. Sportingbet isn't that big in the UK whereas Hills are huge. Step outside the UK though, and that polarity is reversed in certain regions.

BetFred have announced they are at the submission stage of applying for an Australian wagering licence. As with most of the Aussie corporates, that licence would be in the Northern Territory. No word yet on whether they would do a Bet365 and start afresh, or go to the PaddyPower/Sportingbet/Unibet (and probably soon to be William Hill) route and acquire a local firm. There aren't many left of the latter, and those that remain, well you'd have to think there were valid reasons why they were still on the shelf. Virtually all have been looking for a buyer... I think it's a funny move from BetFred - their specialty is retail which they won't get in Australia, there's no casino/poker/games likely to come in anytime soon to prop the business up and the market is saturated to the extent that prices for sponsorship and advertising rates are ridiculous - only the biggest budgets can compete.

At the recent announcement to shareholders, Ladbrokes said they were not in talks with Tom Waterhouse over a move to Australia. This denial comes after reports in the press Down Under that a global gambling giant had been in talks with the most annoying man on Australian television (TV advertising saturation). "Australia is not our main target at the moment" was one of their quotes. Meanwhile a gaming analyst firm has suggested Ladbrokes could be the ideal company to take over the retail wagering licence from Tattsbet in Australia. Whether local regulators and government agencies would allow a retail betting monopoly in several states to be owned by a foreign company is another matter...

Rank, the owners of online sportsbook Blue Square, have announced the business has been running at a loss for sometime and is for sale. Being online only in the UK is a very difficult task - Bet365 have done it brilliantly with huge emphasis on in-play betting and international coverage, Sportingbet also saw most of their revenues coming from abroad. Blue Square's budget was tiny in comparison and they never seemed to take more than pocket change as a bet. 888, who use BlueSquare to provide their sportsbook service, have rejected the idea of vertical integration, suggesting the ambition was too low. 888sport have been sniffing around for another supplier for years without moving, I'd expect them to make a much bigger acquisition when they do take control of their own destiny.

Betfair shares have risen in value in recent weeks, on the back of some encouraging international news and on the continuation of new CEO Breon Corcoran's cost-cutting strategy. The number of jobs being cut is said to be in the hundreds as the business continues to evolve from the punter-friendly exchange to the evil gaming giant that wants to steal every penny from your wallet. Starting this month, any new uncookied visits to the website begin at the sportsbook rather than the exchange.

Spanish regulators are starting to see sense regarding controlling what locally-licensed bookmakers offer. If punters can't find it locally, they'll go elsewhere, plus monitoring it all is not time well spent. It is now open slather for bookies re markets like player and team specials, as per all the firms they are competing against. Note the difference between them and French regulators.

I haven't seen it in the papers but a source has told me that Canbet has been sold once again. The former great US-facing book has changed hands a few times in recent years and its departing owner was an Asian company with Australian bookmaking legend Mark Read as major shareholder. Read scaled back most of his betting interests after the sale of IASbet to Sportsbet/Paddy Power, but kept this one going as it was outside the no competition clause of the sale. The reason for the dispersal is believed to be his poor health. I had the pleasure of working for Mark for my first two years in the industry, he was an excellent mentor (whenever his wife wasn't in the same room).

And finally, things are starting to move in the States for various forms of betting. The state of Nevada has given approval for interstate online poker if any other state chooses to join in. The New Jersey governor has signed a bill allowing online betting (from Atlantic City casinos and only from people outside the state apparently) and California is said to be considering a motion to introduce sports betting. Sounds good in principle, but nothing is simple in the US. The bills will be too restrictive and that's before the major sports leagues are allowed their say and will use every ounce of their political clout to have it banned. These billionaires who think that Joe Public having a $5 bet at a nearby betting shop through a licensed, audited operator is the devils' work, while keeping it largely illegal and forcing all the action underground, often into the hands of organised crime, with far greater means and motive to coerce stakeholders into corruption, is a far wiser proposition. Still, in a land where people get shot for working in an abortion clinic and the nation's response to recent Newport tragedy was to buy as many guns as they could before politicians had time to ban them, is anyone surprised?

2 comments:

  1. Thanks for the updates Scott, interesting stuff.

    Re. Betfair cookies; I was using a non-punting friend's iPhone the last week and went on the Betfair mobile site, and really didn't find it easy at all to switch to the exchange, like navigating a labyrinth. Although that may have been partly me being confused by what I found compared to how the site is set up for me automatically.

    I don't really understand it myself, are they not just going to annoy more people than they please with this sort of move? Do they really think new customers are going to Betfair and just want fixed odds? Maybe that's what they want, but to me it's sending out a mega mixed-message and from a marketing point of view is a bit of a mess??

    Cheers
    Sam

    ReplyDelete
  2. Assume the philosophy is "we've screwed the existing customers around so much they won't leave no matter what we do, so let's focus on the new ones"....

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