The Goose That Laid The Golden Egg Has A Sore Leg

Confusion, rip-offs or just good business? How can you describe the range of odds now on offer for greyhound punters? The situation has worsened over the last three or four years as the number of Fixed Odds operators has increased and the size of the average tote pool decreased.

The former reflects firms wanting to jump on the gravy train while the latter is an outcome – in major part – of TABs and racing authorities jamming more races into limited prime time space. They failed to work out that there were no extra punters to match the jump in race numbers. Or maybe they did, but just didn’t care.

Fixed Odds had its genesis in the attempts by TABs, mainly Tabcorp, to compete with online bookies, which had started selling the TAB’s own product – ie by offering tote odds or, even better, best of tote odds. Tabcorp could see its core business being white-anted by the newcomers and had to react somehow.

Of course, the online bookies then took the obvious next step and added a Fixed Odds option to their own product range. It all must have worked for them as they now control over one dollar in every five of Australian wagering. Tabcorp is also recording declines in its traditional tote business, but claims its growing Fixed Odds turnover is making up for it. TattsBet belatedly followed suit, but it really had nowhere to go because its pools were always much smaller and looking less competitive with Tabcorp as each day went by.

But how does the greyhound punter fare? Essentially, he has lost on both counts. The tote service is less satisfactory because of smaller and more erratic pools, whilst the Fixed Odds caper is not the escape he thought it might be (or not if he examines what he is buying).

The simple reason for that is that the prices are terrible. TABs and online bookies are all setting up books of around 130% for Fixed Odds, a figure once limited to bush meetings involving unknown runners. That means that, over a period, the average punter is going to get back only 75 cents on his dollar. He is getting no help from the two main racing authorities – GRV and GRNSW – because they are also posting similar 130% books, more or less, on their formguides. No guidance there.

How those authorities dream up the odds is a mystery – presumably someone’s opinion – but you can be sure that the online bookies will smartly follow them or Tabcorp, with only minor variations from one to the other.

Tabcorp may well claim it needs to charge more for its service because it is hard to run a balanced book. (No doubt Fixed Odds would tend to attract slightly better educated punters who would be less inclined to speculate on long shots). But this ignores the logic that they run thousands of races under these conditions, every one of them with runners offered at big “unders”. On that basis they can never lose, never mind the odd bad result.

Whatever excuse Tabcorp has, it is not acceptable. But what can you do about it? It is not a parimutuel pool, where government oversight of deductions is always present (as a condition of its license), but an open slather for the operator. Grab what you can while the going is good.

On top of that, all parties operate on a “belt and braces” system. The online bookies, which enjoy very light regulation, are gaining a big reputation for cancelling accounts for winning customers (the evidence is all anecdotal but it is widespread), and therefore relying on bad punters. That is their privilege of course, but it does reflect the absence of the usual rules of racing. An on-course bookmaker has no such luck and must follow the local club’s practices, including one which requires the bookie to accept any bet up to a certain pre-determined limit. Those which consistently offer poor odds would soon find punters going elsewhere.

For their part, it seems the TAB attitudes are little different. We have managed to obtain a copy of Tabcorp’s instructions to its staff about handling incoming bets. This illustrates how they manage to take extra care (for which, read extra profits).

“Fixed Odds … requests will be intercepted by TAB for Fixed Odds operator assessment prior to either;

1. Full bet acceptance.

2. Full bet rejection.

3. Counteroffer – reduced stake.

4. Counteroffer – reduced odds.

5. Counteroffer – reduced stake and odds”.

Presumably, the operator will accept or reject the incoming bet on the basis of whether Tabcorp looks like making a profit on the race. And don’t forget this is based on a price structure which already is set up to ensure the house never loses anyway. It’s win-win for Tabcorp but bad luck for consumers.

But also consider some competitive options. Gallops punters, particular at the Sydney and Melbourne races, will see trackside bookies usually structuring prices to 110% or less, always with one eye on the tote which works on a 117% book for Win bets (that’s the equivalent of the legislated 14.5% deduction from the punter’s dollar). At the same time, Tabcorp is offering Fixed Odds on a book of around 120%, which is theoretically not competitive but still pulls in a lot of money.

But why, you might ask, does Tabcorp use 120% for the gallops but punishes greyhound punters with 130% books? In either case the house has to win over time, whichever structure is chosen. The extra margin, unfortunately encouraged by greyhound authorities in NSW and Victoria, ends up as fruit for the sideboard and has to be classed as a rip-off.

But there’s more. GRV only recently reported how great it was to see Fixed Odds betting rising sharply, and presumably paying more commission to the authority. So, not only is GRV supporting the concept of publishing crook odds, but it is also hoping for more of the same. How could such a policy be counted as ensuring the “development and progress of the industry”, as all authorities are bound to do? High interest rates always turn off house buyers and high betting takeouts will do the same for serious punters – or any punters really.

More deeply, as we have warned previously, the very concept of high takeouts from the punting dollar poses risks for the industry’s future. The diversion of wagering business at American greyhound tracks to nearby casinos has been accompanied by numerous track closures, while others would like to follow if they could vary the conditions under which they were licensed. Loss-making racing in Florida, by far the country’s biggest greyhound state, is already under review by the state legislature. (USA takeouts, including taxes, start at 20% and go upwards, depending on the jurisdiction).

Back home, if the pokies pay better (and they all do), is it any wonder that racing’s market share has been waning for two decades now? All that stops it collapsing is the emotional attachment of gamblers to the racing scene – a very fragile foundation, particularly for greyhounds which generate nowhere near the affection that the public feel for horses.

Racing authorities’ short term tactics may have brought in a few extra dollars but their strategies pose long term risks for the industry.

Meanwhile, study the form carefully, avoid odds-on and demand value for your dollar.

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