Is Tabcorp Killing The Goose?
Our entire wagering system is founded on the performance of our two main tote companies. They make up some three quarters of the action but they are looking shaky.
For many years, both thoroughbred and harness tote betting has been in decline. Over the same period, greyhounds have grown simply by adding more meetings but that effort has now come to a halt. Sports betting, a relatively new option, has grown simply because people like to bet on them. They can now do that easily where before it was hard.
The greyhound development was not a response to internal demand or canny management but to calls from Tabcorp/SKY to fill holes in the weekly program. Never mind how, just do it. Since neither horse or dog populations have increased – rather the reverse – it follows that average field quality has fallen away.
Simultaneously, the betting climate changed radically with the rise and rise of the Northern Territory's online bookmakers and to some extent the intrusion of overseas based operators “illegally” attracting local business (one of which, from Vanuatu, is currently under pressure for failing to pay out winning punters). Both groups are filling gaps deliberately created by the stick-in-the-mud attitude of traditional racing establishments – ie by poor management.
But, regardless of their original purpose, all operators are now basing their products and services on what the totes offer. The strain is obvious, particularly so for greyhound racing.
According to news from GRSA, South Australia's results for 2013/14 include a slight fall in tote business but a compensating rise in online bookmaker turnover. Roughly, this parallels the position in Queensland, where authorities have just concluded a fresh agreement with Tattsbet that led to the recent announcement of big prize money increases. These states provide Tatts' two main sources of wagering business.
Tabcorp has already reported significant falls in traditional tote business in both NSW and Victoria. So there is nothing to suggest that the trends will not continue and, arguably, lead to further destabilisation of the Australian market.
Even so, Tabcorp CEO, David Attenborough, in a recent speech advised he is “pleased the company is performing well”. From Keno, perhaps? Or sports betting? And also from its coverage of overseas racing, which is set to grow and further shove local events into the background.
Brave words from these two betting monsters invariably claim wonderful things are happening but ignore the impact on traditional racing. First, the more races they cover, the less customers will have to spend on “normal” racing. Punters' pockets are not unlimited. It will particularly affect greyhound racing where many meetings are relegated to the less rewarding SKY2 platform. Second, the attractiveness of all greyhound races is reduced because of the relative fall in pool sizes. So, while the tote companies are robbing Peter to pay Paul, the incentive to patronise greyhound racing is also reduced. The product is not good enough financially, and perhaps in other ways as well.
What Attenborough is trying to do, in the old words, is to stuff a quart bottle of milk into a pint container. There has been and will be spillage.
These trends are occurring today but even more important is the likely disturbance to the very structure of the Australian betting market in the longer term. For example, as normal tote turnover continues to decline what will that do to price integrity? The very essence of punting is the attempt to obtain value from your investment. How can that be possible if the price is jumping around like a duck in the bathtub?
Put another way, thousands of poker machines clunk away, day and night, in Australia's many gambling venues. None is any different from another. They are all just machines, played mechanically by people who will always lose – winning is not an option. Yet wagering, punting, call it what you will, is headed down that same path as skill reduces in importance and the potential for winning, or at least breaking even, is gone with it. What's the point? Where is the challenge? The elite few may do well enough (not least because they don't pay full entry fees) but the rest will suffer the fate of the pokie players.
Currently, the impact on gallops pools is disguised by their sheer size, albeit that size has been shrinking for the last 20 years. However, pools which are already small, and getting smaller, are fluctuating wildly – partly due to their size and partly due to the increasing proportion of mug gamblers supplying the cash. That's where greyhound racing now sits.
In essence, that system volatility is a bigger factor than the variability in the players' knowledge. The system is more dominant than the person. Even if you have skills, you are less and less able to use them. So why bother?
Already, Attenborough reported that in 2013/14 “about 25% of our wagering turnover was through digital channels” and, of that, “more than half was through mobile devices as the likes of iPhones become more popular”. Yet someone with an iPhone in one hand and a beer in the other is hardly likely to study the form, never mind whether another “app” offers it or not.
By all means capture as much of the mug gambler trade as possible, but if that puts serious punting further into the background it will leave greyhound racing with nowhere to go in the long term. Except to join the banks of poker machines in the local RSL. But, oh dear, we are already there – that's what Trackside machines are for. They are the final insult – a mechanical race sitting side by side with a real one.
Nationalising the betting pools will help a bit but will not solve the underlying problem. If I can mix my metaphors, the racing industry has a tiger by the tail but no ringmaster to control events.
Am I being negative? Maybe, but these are the facts of life. Ignore them at your peril.
MORE FAIRY STORIES
Stewards report, Race 6 Sandown, Thursday 11 September.
“Warrior King (6) crossed to the rail soon after the start and collided with All Strung Out (3), Ennis Bale (4) and Pappa Gallo (5)”. (Box numbers added)
Not even close. In fact, Warrior King never reached the rail at any stage of the race and never wanted to. It likes to race a couple off the fence. It was three dogs wide and quite happy as they passed the judge the first time. There was no such “collision” worth mentioning. Any interference amongst the above dogs was caused by All Strung Out moving to the right after the jump, but behind Warrior King.