With the world economy staggering like a horse in the throes of a bleeding attack, Australian punters are rallying for the Melbourne spring carnival - the greatest month of racing on the planet.
That's the good news. And the bad? "The critical thing at the moment is bookmakers are trying to take the income off the tote by offering tote services but not making the same industry contribution," said Robert Nason, the manager director of Tabcorp wagering.
"Australia, more through lack of action by government than deliberate policy, seems to be heading down a path to an open market where bookmakers will dominate. The tote will be a small player much as it is in the UK. As a tote operator I can't compete with one who can give lower prices than we can for the same service. We are seeing a big change right now and it will accelerate.
"The wagering operator that wins, in the competitive marketplace, is the operator who can organise to pay the least amount of money [to the racing industry].
"The partnership between the racing industry and the tote has served Australia very well but is at risk if bookmakers can give you trifecta, quadrellas, first four, flexi-betting and all that plus the best tote and 5 per cent [commission]."
Nason stresses this is even more important than the free ride the Northern Territory corporates and Betfair, the betting exchange, have had in recent years that is set to continue over the most lucrative four weeks in Australian racing.
"Turnover in the Northern Territory market is astronomical," Nason said. "Every Northern Territory bookmaker has the capacity to offer tote product and tote services that are identical to ours at a better price. While they can do that, advertise freely, and have a presence in the market it has to damage the future of tote betting, and industry returns because the tote is the major funder of racing.
"The import thing to consider even if bookmakers pay 1.5¢ [turnover tax] in the dollar, the tote pays 6¢. If we moved to a bookmaker market away from the tote, even at 1.5 percent, the industry loses 25 per cent of the current funding.
"Betfair is irrelevant. It will only ever have a small market share. Yes, it's important to get the rate [they are charged] right and have that determined in the proper way but the bigger issue is tote v bookmaker."
Tote betting, according to Nason, should be restricted to tote operators, but Fixed Odds should be deregulated with tote operators "being allowed to play", hawking their prices alongside bookmakers at the track. Tabcorp, of course, only recently opened Luxbet in opposition to bookmakers and is insurance against governments pushing a bookmaking future.
"The industry in Australia and the governments of Victoria and NSW have the ability to make decisions about what they want the future of wagering to be," Nason said. "Since the privatisation in Victoria and NSW, we have paid $1.5 billion for an exclusive totalisator licence. If the state can't provide exclusivity the whole game changes. The Federal Government can step in and make it a nationally regulated industry with national taxation."
Where will racing be in five years if this situation remains?
"Our Northern Territory move [Luxbet] is very strategic for us," Nason answered. "If the future is going to be with bookmaking we need to have the presence. We believe the tote is the right model for Australia and the racing industry. In a lot of ways we are the envy of the world: how well it is run and the level of funding it provides for racing. Yet there are those in the market trying to undermine that."
And the effect of the world economic plight on the carnival? "We are hearing word of corporates not taking up as many spaces at Flemington as formerly," he said. "Generally in times of recession you see a dampening in wagering."
Normally, punters bet up when the going gets tough?
"That's right. But it's a long time since Australia has been in this position. These days we have a lot more large punters playing in the tote space and fixed odds space who rely on business incomes. That segment will be hit."
Email a friend
Favourites
Del.icio.us
Facebook
Digg
StumbleUpon
MySpace
Reddit
Newsvine
LinkedIn
Kwoff
Twitter