Monday, April 2, 2012

Shoot Foot & Repeat

One wonders how racing does the same things over and over again, finds out its a bad idea, but does it again anyway.

Last Friday in the high court of Australia, old time racing (the Tote) took the Corporate bookies to task. In this round the high court went with the TAB, and imposed a turnover fee on any of the corporate bookies, which essentially keeps TAB's monopoly in place.

Who does this hurt? You guessed it, the bettor.
  • RNSW CEO Peter V’Landys said on TVN on Sunday, “this was never about the punter”. However, what he has always failed to comprehend is that everything starts with the punter’s dollar and the finished product in his patch is likely now to be more expensive and slowly force racing punters to more attractive options, of which there are plenty. He claims to want to look after the 50,000 participants in the racing industry, but continues to ignore his most important and valuable participants, the four million punters who actually fund the industry
Ironically, this is the same Peter V'Landys who said the sky would fall when punters were given choice, with the corporate bookies.
  • V'landys: "This is the biggest problem the racing industry has ever had, because this is a direct threat to its funding levels." Then again: "It has a massive impact. As I said, 70 per cent of our income comes from wagering, so if that money is being pilfered out -- and we are not getting paid to put the show on, it means that all our 50,000 participants in the end will lose."
I think it's kind of funny that there are still 50,000 people (using his own two quotes, years apart) employed in the industry after such a dire warning.

What really happened, is that in 2011, two and a half years after these bookies who "pilfer" were allowed to operate, Australia had a record handle, and record purses.

Of course the people who understand gambling and gamblers get it.
  •  Sportsbet Executive Chairman, Matt Tripp, who also founded Sportingbet Aust, expressed concern that last Friday’s decision may lead to reduced income for racing. “As has been proven by the increase in wagering turnover since the emergence of corporate bookmakers, competition stimulates choice and in turn drives growth and revenue to racing. Giving the TAB a walk-up start will hinder competition, and restrict growth which may harm revenues to racing.”
So let's get this straight: Handle went up, revenue went up, and Peter V'Landys wants to stop it?

In the future, handles will fall - because punters aren't playing racing like its a charity, they want choice and a chance to make money - and what will V'Landys do then? Probably find something or someone else to blame.

I hope people learn that you can't squeeze your customers, stifle their choice, and make it harder for them to enjoy your sport, and expect to grow. I hope so. But it's not very likely.

Racing needs one huge house cleaning.


William Child said...

Excellent Post Dean.
This perspective has been mostly overlooked by the racing media here in Australia.
One article in the Daily Telegraph informed readers that punters will be better off because higher prize money will lead to larger fields and better racing, etc. That must sound eerily familiar to followers of Canadian harness racing I imagine.
I should note that the product fee of 1.5% of handle does not seem too onerous. The corporate bookies have been paying that amount into a trust fund while the court case has dragged on for the last couple of years.
Hopefully other administrators in this country will see fixed odds wagering operators as partners and drivers of future growth of the sport, and not as pirates who are out to plunder racing, as V'Landys has sometimes suggested.
The fact that there is now more money available to the racing game is not a bad thing by any means, but to not use the money wisely would be a shame. The sport here should learn from the example of racing in Canada and how it made use of the slots windfall over the last several years. I fear that very few influential people in Australian racing are aware of it.

Pull the Pocket said...

Nice to hear from you William! Thanks for the response.

Yes the ol "you should be happy purses are going up" mantra, eh? They use that line here a lot.

I wonder if those same people are happy paying $5 a gallon so the Dubai World Cup can offer good purses? They should be thankful.

Thanks again.


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