TABCORP boss David Attenborough wants to thank all those folk who have switched to Fixed Odds betting in the last financial year. They were a big help in earning him a bigger profit – up 158% to $334.5 million, of which wagering and media accounted for $247.2 million. Well, he did not actually say that but it is obvious as Tabcorp takes a 10 points bigger cut out of Fixed Odds bets, compared with the normal tote.
Fixed Odds now attracts just over a quarter of all Tabcorp betting, with turnover in 2014/15 increasing by 33% over the previous year. At the same time traditional tote business fell by 2%, which is no great help to greyhound racing as its pools were already uncomfortably small. But, for Tabcorp, that combination means it is now gaining a higher profit per race.
In total, Tabcorp wagering and media revenue rose by 6.9%. Attenborough attributes that to a greater emphasis on digital access from mobile phones and the like.
Tatts Group (Ubet) is due to report shortly but in 2013/2014 it dropped 2% in wagering, compared with the previous year, while the half year to December 2014 was not much better. With its major market in Queensland in disarray its future is looking a bit grim.
I have four queries about all this.
First, given the unprecedented high takeout from the fast growing Fixed Odds business it is surprising that one or more of the wagering contenders has not started offering better prices. You would think competition would prompt someone to gain market share by doing just that. After all, a book of around 130% provides a huge mark-up for the operator to play with.
It is also a wonder that state governments allow customers to suffer such an impossible burden. (The normal tote “book” is equivalent to about 116%). It’s hard enough finding some value on the tote but the punter who can overcome a 130% book has not yet been born. Of course, greyhound authorities are no help. Both Ozchase and GRV formguides also post similarly excessive price lists.
Second, the clear trend is towards smaller pools as gamblers divert to Fixed Odds and the like. The more that happens the less integrity there will be in tote prices – yet they are still the guiding light for everything else. When coupled with late betting habits – common for the dogs – it means genuine punters have less and less to guide them before making a bet. It adds a gamble to a gamble. Nothing short of a national betting pool will solve that problem.
Third, neither of the above two items encourage more betting from serious punters, hence the continued rise of mug gamblers as a proportion of total investors. In turn, that contributes to more sheep-like behaviour such as over-betting on favourites or following a popular tipster. It also tempts the better punters to leave the tote and try to pick out a decent price on Fixed Odds (but good luck with that).
Fourth, the modern trend towards use of mobile phones and other hand-held devices has encouraged Attenborough to add more staff to process digital betting. At first glance it sounds fine but you need to look deeper. Betting like that is essentially a casual effort and devoid of any real consideration of the fine points of form or track peculiarities. Efforts by racing authorities to offer information for mobiles are unlikely to support anyone really interested in studying form. A tiny thumb-operated screen does not lend itself to making detailed comparisons of stuff they really don’t comprehend in the first place. Nor, for that matter, do some of the rubbishy touchscreen form displays now appearing in the odd PubTab. They offer only three previous races, and contain times and margins only for winning runs (no idea who produces them – they are anonymous).
The totality of this is twofold. The industry is marching towards a framework of mug gambling where the customers don’t know, and probably don’t care, what they are doing. It’s just a bit of fun. Assisting that trend are equally uncaring governments which have allowed wagering operators to get away with practices that would be considered laughable in any other gambling market.
Does this pose a risk? Well, for a start, it is endangering racing’s position in community social terms. Punting is an art which requires study and skill. Gambling is nothing more than greed and therefore attracts adverse attention from lawmakers, social researchers, wowsers and so on. (Note Senator Xenathon is on the march once again). At the moment, wagering on races throws up only a tiny number of problem gamblers by comparison with the pokies and casinos. Given the rise and rise of mug gamblers, that could change to the industry’s detriment.
But quite apart from that, the absence of education, formal or informal, in the intricacies of wagering will continue to hamper the expansion of the industry, dependent for its life on betting commissions. So, whatever the short term success or otherwise of the tactics being employed, the strategy is very risky – and for Tabcorp, too.
Currently, Tabcorp is getting its rewards through brute force, not by finessing the market. Hence the force-fed racing program, domestic and international, which customers have to wade through. Its smaller cousin, Tatts/Ubet, is already showing how chancy that approach can be.
So, what is the greyhound racing code doing about all this? To date, nothing much. The problems created by live baiting also amounted to an opportunity to bring in some meaningful reform. The count at the moment is two to none against any worthwhile change – Queensland and Victoria both avoided the hard questions, or maybe they just did not understand them. Only NSW remains to report but at least there we have our fingers crossed as Michael McHugh QC is known to like a bet now and then (albeit the family is gallops-oriented).