Don’t forget to gamble responsibly..

Watching the Oikball the other night, sitting next to my Sons, I observed West Ham sporting their snappy outfits pressed and laundered by Betway. Newcastle were sponsored by those nice people that lend money – Wonga. The stadia was adorned with Betway bunting. The adverts during the game were predominately sponsored by companies claiming their users ‘gambled responsibly’ – Especially Ray Winstone, who I doubt has had a tenner on anything in his life. But it’s great viewing for children. Honestly

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If you like to watch sport, you’ll get used to this. If you like your late night telly – you know – stop camera action from the police force in Reading, the best looking penis, or shows about cars with fabulous emission ratings, you’ll also have become used to proliferation of gambling adverts. Some of whom sound almost heroic.
Of course we’re encouraged to ‘gamble responsibly’ by the yellow sign that tells us all (subliminaly) that when we’ve had enough FUN FUN FUN – we must learn to stop.
In other words, when you’ve run out of cash, maxed out every credit card you’ve got, kicked the fruit machine to bits, mortgaged your home to the hilt, turned your Missus into a Lesbian, and of course made the BBC documentary on ‘Britain At The Bookies’ – the home for all genuine sad acts, – then you’ll have truly arrived in the worlds of Bet365 and William Hill
If you’re in the minority, like me, the Mary Whitehouse types, you might pause for a moment and wonder what effect this siege of advertising has on our phsyche- not to mention those of our children. I mean we stop cigarette adverts, so why is it permissable that EVERY ad break tells us we have to spin to win? And sometimes more than once a break?

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And of course, as every independent bookmaker and decent minded citizen knows- The UK’s ‘watchdog’ – the Gambling Commission, with all its fees and hype – does absolutely nothing. Nothing at all, to justify its very existence. ‘To protect the vulnerable.’

The ‘vulnerable’in this case appear to be online gaming giants

Little known- but worth mentioning, back in April I challenged Paddy Power on promotions headlined with the banner ‘money back’ on certain wagers. This was a headline grabber and peddled widely in the press. I invited them to desist from encouraging customers to wager under the entirely false assumption certain stakes would be refunded, when in actuality the customers were being refunded in ‘free bet stakes’. Of course the two are entirely different offers

Paddy Power declined to remove promotions with said headlines.

I challenged this with the ASA as misleading and wholly false. The challenge was upheld and they were ordered by the authority to cease free bet promotions with the headlines money back.

Paddy Power were not alone – Many firms were doing exactly the same, and in direct contravention to an earlier ASA ruling against Betfair for the same type of claims. These firms were directly contravening an earlier ruling

The question is this. Why did the Gambling Commission, the custodian of fair gambling and the vulnerable, not step in at any stage to order such promotions to be withdrawn? Is this agency actively complicit in protecting such firms from basic licensing conditions? Were said firms not in fact contravening several codes in licensing practices with such claims?

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I think I’m a fair minded bookie. I try to give my customers a better class of service and compete on odds with the high street. And as a bookie you might expect me to side with my own. I mean I do have a gambling site. But I don’t bombard people with adverts at 2am about it, and if I were to shove it on my occasional trips to Channel 4, where I upset the establishment for your viewing entertainment, I’d get my backside kicked off pronto.
I’m deeply uncomfortable with what goes on. I feel for those who are suffering. I favour a UK wide ban on anyone who self excludes – not backed by the Gambling Commission. I disagree with the use of credit cards to fund gambling. I disagree with Gibraltar outfits shoving their ‘online’ products to Racing. Although I scoff at the BHA’s lack of backbone in any department, all sound bytes.
I hear a lot of complaints from punters, some of whom could accurately be described as ‘bonus junkies.’ The new breed of professionals who scour the bookie websites for top of the market hits. I have some sympathy with the bookie view that a lot of those types of customer are worthless to us in business.
BUT. If Paddy Power are to offer even money each of two in a Rugby match, with just the outside chance of a handicap ‘tie’ to save them, if Skybet are to offer a loss leading 6 places on the Cambridgeshire, if Coral are to offer 6/1 each of 2 in a tennis match to new customers only – and all of them make money, then I know they’re not getting fat on those sports, especially the increasingly worthless racing product.
So they’re fattening on gaming. – NAP

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Bet365 seem totally content to treat their customers with err, uhm contempt, by offering a customer, their customers, a £1 wager. They don’t care about the PR implications of being described by the same as ‘total frauds’ for describing themselves as ‘Bookmakers.’ Because they’re global. And for every clued up punter they treat so poorly over here, there are perhaps 5% of these new accounts they dig up that make the whole exercise of pushing for new business worthwhile. And deeply profitable. One can admire their bottom line, if not their methodology
Should we feel sympathy for those professional types who complain so vociferously? Clearly we care about the genuine punters who fluke a 16/1 winner and find their next wager batted down to 36p. But the pros?
For myself, I never keep a customer on if I’m not prepared to lay him or her a bet to lose at least £50 as a minimum, and remember that’s my minimum, not the average of what we’re prepared to lay. But that’s because I have standards. I may not like what some customers get up to, but if I do, I close them down with a fair explanation of why it’s been done. We do not hide behind ‘trading decisions’
But the big companies are the ones peddling the prices and offers. They’re continuously driving for new gaming custom and fully prepared to be ‘best odds guaranteed’ or ‘best prices for all Channel 4 races’ – even if it guarantees a loss. It’s a bit like the supermarkets claiming they make nothing from milk, because they choose to sell it so cheap to get the customers into the stores in the first place. They don’t care if the dairy farmer ends up out of business.

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These ‘companies’ have created the bonus and offer culture. The free bet. I heard recently Coral offering a guarantee to lay any horse to lose a decent amount, I’m uncertain if it was Coral’s diminutive UK division or their Gibraltar arm making the offer, because its hardly clear who you’re wagering with when you call up ‘Coral.co.uk’ . They’re not prepared to offer it online, nor even on their phones. Once again a headling grabbing offer that turns out not quite as good as it sounds. But in a way I support any move towards a sensible lay to lose – I’ve always advocated £100 as a startpoint. Coral stand alone in proferring any sort of guarantee to date, even if it’s only in their shops.
But they’re a multi million pound outfit, still un prepared to offer their advertised odds to all of their customers. A bit like Waitrose saying it’s 50p for that Cadbury’s flake, but not to everyone. Isn’t this sort of thing a trading standards issue? And of course pretty much all of the other outfits are exactly the same. Complaints litter about what they don’t do, far more than what they do. Now why is that?
So the next time you think about grabbing yourself a ‘free bet’ for a tenner. Ponder awhile. If you can afford not to support firms who behave with such overall disdain for large sections of their customers, why would you support them with your business? If you want change, you have to be prepared to boycott those firms you consider place little real value on loyalty.
And should they be mandated, as they are in parts of Australia, to lay a fair bet to any price they offer?
Well the Gambling Commission don’t agree with you, but I most certainly do.

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Royal Ascot – 2015 – The Bookies View

www.geoff-banks.com/register.asp

Driving around Ascot is a pretty harrowing experience- streets full of burnt out Bentleys. Every once in a while you’ll pass a Waitrose, and really know you’re in a bad area.. they don’t do Tesco here – no matter what they make (? insert amount ??)

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The trick to Ascot is finding somewhere convenient to park- there’s an exit one way system which sends you back to Sunninghill (a mile away) via Biddlecombe (286 miles away)-  You have to know the system or you’re stuck in the High Street for several days

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Flick knives and knuckledusters  dutifully handed over, you’re greeted by throngs of gatemen. First thing you notice is how polite they are, they check what socks you’re wearing and smile. You see, at Royal Ascot- everyone feels like a Lord for the day – even if you’re entirely potless. Bookies enter with money, – they’re x-rayed on the way out to ensure they’ve left it all with the punters..

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One enters the truly vast terminal- had it’s detractors when it was built, but these days thanks to ‘green fingers Barnett’ – the place resembles an advert for house and garden. Full of comfy armchairs- nooks and crannies to enjoy your glass of champagne. Uber civilised.Quality extends to every enclosure, a track run by toffs- but to everyone’s benefit – no enclosure escapes the personal touch – and you can escape the beer swilling hordes if that’s your bag

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They don’t do Pomagne here!

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And yes,  they actually serve a bottle of champagne in an ice bucket, not a bag, and with a glass should you so desire. You see, if you’re not at Ascot, York or Goodwood, where they do things with panache- most tracks think you deserve a bowl or tumbler to drink your champagne from.  Odd sort of business plan for your best spending customers wouldn’t you agree? Ascot hasn’t dipped standards to the banal trick of hiding customer service values behind health and safety.  .

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Ascot also don’t do themed evenings for people dressed in football shirts..possibly because they take the view their long standing real racing fans might object to spending their days with Yah Yahs..

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But I digress

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When they rebuilt the old Ascot – some of the members said they’d never return. Well I suppose if you’re pushing up daisy’s and by extension possibly not reading this – that could indeed be true. For the rest of the ‘I’m never going again’ mob – it appears to my inexpert eye, that Ascot have built one of the world’s best sporting arenas –  outstanding restaurants, bars and service. In a racing environment obsessed with sand , it’s refreshing to walk into an Ascot or York where the focus still remains what goes on around the track – not (perhaps) in a betting shop.

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I spot Nick Rust, the new BHA chief exec in the throng – clearly his suit was made for someone bigger – he’s chatting to someone about ‘coming together’. I wonder idly if he’s explaining why they dug up Newcastle to create a terribly interesting series of races in a straight line. For this week though, exceptionally and perenially, we have the best racetrack in the world.

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The first race rolls around – there’s a lump from Hong Kong – ‘Able Friend.’ Our Gallic friends have sent over a Goldikova clone. Most bets are in euros, as the far east specialist proves more suited to racing at the back. Solow wins well and Maxine Guyon flicks a V sign at the toffs as he passes the post. I don’t blame him. The bookmakers rename the winner ‘Sorrow’

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The rest of the day degenerates into the stuff of nightmares for the bookie types as the Festival lurches from Prince this and Queen that . If it’s not the favourite, it’s the galactically talented Ryan Moore sweeping the board. That won’t go down well on the High Street.

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People that know me understand I’m one for speaking plainly. I have listened to several respected scribes eulogising on about the rather evident talents of Mr Moore. Little question he’s probably the most talented jockey we’ve witnessed on the flat. It goes along the lines of ‘isn’t he magnificent? What a rider! And to those that know him – apparently quite a wit’

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Well, to the rest of us, who’d rather a jockey smile when he nails a Derby – he’s a thoroughly morose character – he doesn’t endear himself – nor promote the sport that makes him several millions in any way, shape or form. So no, I don’t find him admirable as a human being. Two weeks ago, we saw a brilliant horse take a Derby with a pilot who will do more for headlining the sport than Golden Horn himself. Leaping out of the saddle and engaging the crowd. That cost me a rake, but I smiled when I saw it. That’s what the fans want – not the taciturn one. He’s for betting – not for Racing. Shape up Ryan! Dettori, McCoy, Hughes, Walsh amongst many happily give of their time –  you can’t manage a smile??

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When you look at the results, you could easily conclude they didn’t look that bad for the bookies, but I suppose it was the combination of several favourites going in – and if they got beat, it was either Moore or Dettori on top. Thursday I think was the most entertaining betting day – with Moore bashing the firms with a 14/1 opener followed by a 5/1 winner. Payouts could potentially dwarf the Mullins quad at Cheltenham.. (Thanks Annie)

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One major off course layer went into hyper drive sending nearly a quarter of a million back for Kingfisher in the Gold Cup- all those 10p accumulators, at guaranteed odds, I expect suddenly come to haunt. This time it was Maxine Guyon to the bookies’ rescue as he held Moore on his inside – causing him to switch paths at the critical stage. For me the week’s unlucky loser. For the major bookie involved- several pence retained on their share price. I expect they were not alone in hiding under their sofas as Kingfisher turned for home..

Racing festivals haven’t been that great for the firms over the last few years. Most lead with fabulous offers and price boosts created by their marketing departments. Combine that with a dip in on course margins – polarisation of expensive horses shared by a select few jockeys and trainers, and you have a problem for those betting on the product. Expect you’re reaching for a Kleenex right about now

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Racing starts every day with a race for the Royals from the mile start in their fancy carriages. Now I’ve watched this for more years than I can remember- never once has anyone tried to pass the one in front. Surely I can’t be the only one who’s spotted the biggest bunch of non triers in racing?? Fair enough, they put on a good show, the whole event surely organised to give the bookies another betting heat to do their brains in – namely the colour of the Boss’s hat. But I’d like to see more effort from those in behind..I know I speak for all concerned who back the second carriage every year

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God save our Queen..you won’t see a pageant like that at Goodison Park..a uniquely British summer scene.

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I took one wander down from the Royal enclosure towards the Silver Ring. Ascot is so vast, the silver ring is nearer to Egham. As enclosures go, it’s really quite well turned out. I walk as far as is possible before the waft of chips overtake that of Chanel.. There are bookies all the way down the racetrack, making noise, taking bets. I wonder what will happen to the very flavour of racing when the tracks inevitably take over the betting. Don’t think we don’t know what you’re about, with your expansive plans for data charges etc etc – we’re on to your tricks!

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Racetrack bet however, could do well at the festivals, I don’t think the punters are in any way price savvy, we know that from Chester – they just want service. But the diet of midweek racing we’re fed by tracks-horsemen-BHA, has leant itself to poor attendances from both customers and bookmakers. What’s the future without the ring? My dream we wake up before it’s all too late – the major betting firms have deserted racing for football and roulette. I suppose then the sand will go back to the bunkers. No Big Jim, Barry Dennis, Victor Chandler

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Imagine a world where an exec at Channel 4 suddenly decides the network should quit racing, in the face of the often ridiculous criticism of a show affording the sport 44 cameras and the best coverage it has ever experienced. By comparison the BBC with its almost ‘cottage’ coverage. Racing feeds the network a diet of 5 runner group races almost weekly and wonder why the numbers are down- then makes it awkward for them to show alternate meetings in its coverage and ignores Channel 4 in any decision making processes at the highest level. Remember,  they can make more money for less hassle from ‘Everyone loves Raymond.’. Don’t think the BBC will come back to save Racing from itself – they barely mention the National

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Racing has an awful lot invested in very few options. Royal Ascot is amazing, but if Aston Villa play Scunthorpe it’s likely to pull in more sponsors, viewers and press coverage. The next few weeks Racing will go into its shell from Sunday to Friday, bang on 7 meetings on the Saturday, and bolster attendances with pop concerts and a grotesque obsession with selling as much beer as possible. Hmm, get back to the Racing. Ascot leads for me with the right balance and never loses sight of its focus on the Sport

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It’s not supportable, but with a regulator fascinated by commerce, rather than how is the sport best served and gels together, – a board of novices to do as they’re told? As Nick Rust so accurately describes- the underlying trends are declining. He’s just not going to do anything about it. Sorry Nick, I don’t do sound bites. I did enjoy your BHA seminar though, with Rod Fabricious harking on about artificial insemination.. not sure who he wanted impregnated though..

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Fortunately there’s enough quality in York, Goodwood, Cheltenham, Chester and Ascot to name a few to keep British Racing at the very top of the world order, British racing has a unique calendar of major Festivals. I wonder if there’s an RCA man reading this, sympathetic to the view most racetracks are struggling with an identity crisis? A racetrack, a greyhound track or just a vast pub. Here’s one to mull over – try proper segregation of long standing racing fans, who don’t feel to have beer spilt over their girlfriends, or even the often threatening environment, from the oiks that do, – rather than selling all in sundry a pass to the members enclosure, keep some areas with civilised folk in mind. Possible? I think also a lot of racetracks need to integrate their thinking with the words ‘social responsibility’ rather than ‘sales’

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Early evenings at Ascot are spent gate crashing car park parties and pretending you’re one of the owners. Everyone standing quaffing champagne, leaning on their Astons, in an age old and endearing slice of the great meeting. It’s my time to get asked by people stuffed with my cash, how much I’d won that day.. (where’s that sharp knife?) Everyone turns up without being invited – ‘Who ARE you – and why are you stealing my champagne?’

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How good was the meeting? Well to my mind pretty outstanding. How does it compare to Cheltenham? Well they’re rather chalk and cheese. Ascot is very much more about the social scene. But there’s no loss in focus on the racing. Quipco have stepped in. There’s a new Group one sprint attracting foreign raiders that really works. It has management focussed on quality at every turn. Entrance charges to the meeting aren’t steep – considering what is delivered. Cheltenham has a different feel. Far more the betting event, with months focussed on it’s feature races. The two great events provide balance. Is it a bit toffee nosed? I don’t think so, sure the babies are on Smoked Salmon, and they tow away Ford Escorts, but one has to keep the Riff-Raff out 🙂

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See you at York – could it possibly get any better?
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Response to SP regulatory commission

Response to SP regulatory system – consultation

Former NJPC chief exec Clive Reams,  recently penned a letter in response to the criticism levelled at the SPRC, after the Grand National, advocating ‘no change’ to the SP system.  When the current mechanism was devised in the 1990’s he argued vehemently against the then proposed system whereby 5 bookmakers could govern the SP returns – as ‘a bookies benefit.’

Of course he was at the time in violent disagreement with a system being proposed where the largest five firms produced the SP’s. And of course he would have been right. To permit those same firms to control the returns, when their off course empires were of such high worth in comparison to a veritable ‘cottage industry’ – would clearly disfavour punters. Any notion of those same organisations using their on course positions to actually bet competitively – and disfavour their huge shop and mobile empires, would have been nonsensical.

Yet now, we see that same official arguing in favour of the current mechanism. Despite the fact that same system has been modified several times, to permit now as low as three trading on course bookmakers, not only to provide an SP, but importantly the shows, otherwise known as board prices

Mr Reams hasn’t been seen in the betting rings for many years to the best of my knowledge.

It’s my conviction the SP mechanism – in its current form, was practicably out of date shortly after its inception and requires thorough modernisation. Not abolishment.

The commission, in its call for responses to the system, makes clear it supports little to no change to the system. That we are afforded a workable and simple mechanism, which provides for such as guaranteed odds against SP. Why the commission feels ‘board’ prices would disappear in any revisions is beyond my understanding. Perhaps to scare people into the false belief that show odds would be consigned to the bin.

We already utilise industry odds in some meetings – Meydan and Longchamp for example. There’s no argument to support the commission’s assertion a system based on track bookie’s odds- is the only one which would support guaranteed odds

It’s rather apparent the SPRC depends upon the advice and views as reported by the press association staff, tasked with returning a fair SP from the racetracks. They are neither witness nor party to discussions between bookmakers – and their customers. Their honesty is not in question here- but they clearly cannot have the ground level experience to report accurately what is really transpiring.

The commission will also consult with the FRB, namely Robin Grossmith for his advice. Whilst Robin is a respected colleague of many years’ experience, it should be remembered that an important part of his remit is to secure payments for on course bookmaker’s data. He would naturally argue the system as working in a satisfactory manner – and without any knowledge or understanding of how the mechanism, currently being employed, affects off track companies. Most track firms care little for the impact their activities have on the wider betting community

The dynamics of betting have fundamentally changed in the last 20 years, whence the current system was put in place. In that time changes have been few and limited in nature. 20 years ago a pitch at Sandown at the top of the rail would have been worth well in excess of £100,000 – and very hard to come by. These days – those same pitches can be purchased for less than a third of that value- and with minimal interest, most certainly not from someone trying to get into racecourse bookmaking as a career! In the same 20 years- the average turnover per race to on track firms would have declined to not less than 1/6th the value of the late 1990’s. Midweek racing has declined in interest to customers to attend. Rings are often ghost towns. Few punters turn up, and in a cashless society they have less to spend with bookies trading. Mobile betting apps have taken over – being more aggressive in nature, easy to use, from funded accounts and related to offers. Racetracks have taken over betting at some tracks –and this new competition to the business a track bookmaker is afforded will have significant impact on their very existence.

My average midweek turnover, as a leading layer, in strong betting positions, is now routinely less than £500 a race- if I bet in any way sensibly. A risible figure. For this reason I rarely attend midweek fixtures. Nor do many of my colleagues. The only way to buck such turnover figures is to exceed exchange odds, then to risk arbing from other bookmakers. If a bookmaker does not offer a pure exchange price on a ‘fancied’ runner- it’s difficult to field any appreciable money for it

Bookmaker numbers have been shored up by some firms operating multiple positions. One bookmaker (John White) operates three positions at Kempton – a small ring as you are aware. Kempton – for example, routinely operates with a sample of around six firms – they are providing prices for a huge off course industry, from a venue where few punters turn up to bet

At the same time as this decline has been evidenced- the off track firms have increased in size, technology advances, and power. Where once betting rings were vibrant and busy, with standard place terms, minimum lay to lose guarantees – and by extension a useful ‘guide’ to SP’s – now they are ripe only to cheap manipulation of their odds. Huge multi national betting concerns can control a weak market with veritable pennies. This imbalance would simply be outlawed in any other financial sphere. It is important for the SP commission to give this point full consideration.

 

VOLUME OF RACING

Since 1995, and importantly in the era of Peter Saville at the BHB in 2005, the volume of actual meetings has soared from around 1000 annually – to 1450 currently. Racetracks have also focussed their business more towards Saturdays and providing cheap funded product. This has had a thoroughly negative effect to the turnover on track and split the punters interest between meetings. Further a customer can now sit at home and watch either ATR or RUK on his satellite – even watch live streaming racing on the likes of Bet365. All have had an entirely negative effect to bookmakers on track. In the same period the expenses of running an on course business have soared. Many bookmakers have quietly retired from the ring

RACECOURSE DATA TECHNOLOGY

In the last 20 years or so most firms now utilise software provided for them by RDT. The build of their system and its layout is specifically designed to facilitate easy wagers to and from exchanges. A wager can be practicably negotiated faster than on a web browser, a whole set of prices backed, or an entire position closed out. RDT receive a commission from Betdaq for such activities. Such software did not exist in said advanced form when the SPRC devised the mechanism in the 1990’s. All bookmaker software on track is designed to facilitate wagers with exchanges. It has caused a sea change in how bookmakers engage in business on track. They differ from their off track colleagues in that instead of being viewed as traditional ‘layers’ – balancing books with real money, they have metamorphosed to ‘traders’

TRADING

What should also be considered is the wholesale change in the approach by on course bookmakers to betting. When the mechanism was put in play, the majority of firms were traditional in nature. That is to say they were in the business of framing a book and accepting risk. This has fundamentally changed. The vast majority now ‘trade’ many wagers away with exchanges to create margin and keep risk levels low. In order to engage sufficient liquidity to make this practice work – prices must virtually mirror those available on exchanges. For example – a firm will typically offer 4/1 a horse for any variance on an exchange from 4.9 to 5.4. If the operator is lucky, he will be able to trade at 4/1 and hedge at 5.4 – bookmakers have become the new ‘arbers’

There’s little discernible difference between ‘show’ odds and exchange odds for the more fancied runners

Off track firms are, by extension, accepting wagers – and risk, on shows therefore based almost purely on exchange odds. This is a far from healthy system – and a central plank for lower levy returns – down over 50% in recent times. Most bets are accepted at board odds- rather than the more ‘protected’ SP returns. Off track firms do not ‘trade’ wagers in the manner in which on course firms do. To boot, since the shows being returned are up to one minute behind changes in exchange odds, off track firms find themselves subject to arbing from punters. This business is unprofitable and most bookmakers close accounts from those engaged in this practice. Such moves are unpopular and leave firms open to unjustified criticism.

THE STARTING PRICE

Let us consider the actual SP – in practice most track firms have stopped trading aggressively, or at all – it’s often too risky to bet to exchange odds and risk a sizeable wager which a bookmaker cannot trade, with the exchange, in the limited time before the off. Prices are revised downwards throughout the ring – or unavailable. Most books are structured and the operator is loathe to change it. Large operators, such as William Hill on course, are naturally particularly mindful to ‘bet well’ with one eye understandably on their important off course entity.  In my experience their returns are given considerable weight in any return. SP’s are, in practice, more favourable to the industry for these simple reasons.

There’s habitually a considerable difference between exchange SP’s and Bookmaker Sp’s

PRICE REVISIONS

It is common in circumstances to hear criticism of course bookmakers for failing to balance books by pricing up horses which they have not significantly laid, at times when they take substantial monies from legitimate hedging activity happening fast and late throughout the ring. Through the year we will hear many examples- the Grand National being a notable one, of an overround which disfavours punters betting at SP.

This is fairly easy to explain- since most track bookmakers are less ‘layers’ than  ‘traders’ . When they do catch late funds for a selection, they are far more about dealing with trading the wager profitably on exchanges. In the 1990’s – most firms would have been trying to balance their books by raising the prices of other runners to compensate, if you will. This is no longer necessary with the advent of betting exchanges and software dedicated to trading

Further, the notion that bookmakers should counter raise odds when there are often no punters to offer those odds to, is fanciful.

Finally, large entities sending money back to the tracks place their wagers as late as practicable, certainly never 20 minutes before the race for example. Again such practices, as in the likes of FOREX, would be viewed as questionable. Is racing somehow different? I am not suggesting they are not fully entitled to boss the SP’s, but there are issues of scale and timing.

 

SAMPLE SYSTEM

The current mechanism employs a bank of up to 25 firms at the largest meetings. At the lesser meetings it is exceptionally difficult to find 25 firms, betting within the commission’s guidelines, to return an SP. The SPRC has revised the number of bookmakers required to return an SP to below the level which caused such upset between the NJPC and the commission in the 1990’s, when 66 questions were tabled on the subject The commission has also modified what it permits to return a show to below the accepted industry standard terms and without requirement for a minimum ‘lay to lose’ figure.

At York’s Dante meet recently, I was one of only six firms in the whole ring, to offer an industry standard ¼ the odds a place in two 16-21 runner handicaps on one day, whilst the rest of the ring were legitimately offering a 1/5th. A bookmaker betting to a fifth in said instance could offer 25/1 a horse – whereas I would only be able to offer as low as 16/1. How does the commission handle such anomalies? Or where the favourite is odds on and all but a couple of firms are betting win only? Once again the sample is nowhere near that required for a fair SP, nor takes into account it is supposed to mirror standard terms off track to be seen as accurate – that is if there were appreciable monies to bet to. There are many examples of such cracks in the system throughout the year, which would not be evidenced if we had a system properly balanced by the true weight of money wagered on a race

We are of course well aware that the Grand National return in no way accurately reflected a fair return. Whilst I would argue that 1.66% per runner is by no means excessive- the truth remains the show embarrassed bookmakers on course, and will lead to customers choosing not to wager at the racetrack at all. Many firms were offering 9/1 the favourite – which was returned at 6/1- at the same time the exchange was offering 14.5 on Shutthefrontdoor.

The simple fact is the use of ‘SP Samples’ as a methodology for returning prices (especially where 5 of the 25 firms in the show represent major off track business) is clearly far too easy, and inexpensive, to control. In practice it’s fairly evident who the firms are that are part of the sample

Bookmakers not included in the sample are routinely ignored. Bookmakers within the sample are often asked to accept wagers at less than the odds they are currently displaying. Particularly at small meetings. Is there clear and incontrovertible evidence that this goes on? No. It is however, quite routine to be asked to ‘co-operate’ on shows in return for the crumbs off of a large concern’s table. If you co-operate – you benefit.

IS this system of hedging fair? Not if a wager is proffered ‘with hooks’. Any discussions with other firms will confirm this is precisely what goes on. It is totally acceptable for a large concern to wager to control a price which reflects the full weight of money. But not where said concerns can control a the market for such a tiny outlay and by openly requesting the bookmaker to cut his odds in return for a nominal wager.

WEIGHT OF MONEY

What should concern the SPRC, is the effect on a fair mechanism of such large concerns wagering with such a tiny entity as three to eight bookmakers trading an all weather track for example. What also should engage thinking, is the possibility of manipulation of weaker exchanges on small markets. Especially when one considers RDT controls well in excess of 90% of on course firms and produces software designed specifically to encourage the practice of trading. In reality, it is Betdaq- the weaker exchange of two, who govern on course returns. In my view this could be viewed as a cartel. It takes a tiny movement of exchange money – typically less than £10, to be followed by several on course layers.

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INDUSTRY PRICES

Why have off track concerns not called for control of their own SP’s to date? Two factors explain this anomaly

First, and rather obviously, where the SP itself is required to be revised downwards, it can be easily controlled in a market devoid of regular punters with a very small ‘hedging’ fund. Large concerns represented on course can constitute up to 50% of those available to govern an SP. Especially as the SPRC mandates that in the strongest rings at our festivals, only up to 25 firms are required to return the show. Hedging can therefore be restricted to just those firms. This is precisely what occurred at Aintree. Indeed one pivotal operator, running multiple pitches, informed me ‘where he was in the sample, he was 6/1, – where he was outside the sample – 9/1 about the favourite’.

If all operators are betting to the same commercial terms – there’s really no need to limit the number who return an SP, and it’s clearly a system which fails the means test in such areas.

Second – what concerns major operators off track, when one considers the issue of industry odds, is how their competitors would behave were the mechanism revised. Would, for example, an aggressive operator such as Paddy Power- buck the general acceptance of a new industry return by producing its own ‘enhanced’ SP. As things stand currently – everyone accepts the status quo, warts and all. Of course most firms would prefer an accurate industry SP, not based on exchange odds on course, but the elephant in the room remains their competitors

With the disappearance of John McCririck from television schemes – a major obstacle to industry odds has been removed

OVERVIEW

Centrally the landscape of betting is unrecognisable – were we to compare it with 1995.

The SP regulatory commission is recommending we keep a system where the ‘show’ odds for fancied horses directly mirror exchanges and where the SP is ‘protected’ by circumstances. Where small time traders – desperate for any bettors can be easily bullied by larger operators and where punters feel they are being cheated (unfairly) by track firms.

We are long overdue constructive change. I welcome this consultation

Proposals.

  1. On Course bookmakers to compile one fifth part of a new mechanism, only where there are an absolute minimum of 25 separate entities available to return an SP
  2. Those 25 firms must be betting to recognised tattersalls standards in every race they are engaged to return the SP. Modified terms can not be accepted
  3. At least 25 firms must be available offering a full each way service to return an SP
  4. Sample system to be totally abolished on course. All firms betting to standard tattersalls terms to be included in the returns
  5. Track bookmakers who wish to include their data in any new return, must undertake to lay any advertised price to a minimum of £100 – to include to other operators.
  6. Four fifths of the new mechanism to involve the 19 largest operators. These operators to include Betfair and racetrack bet
  7. Betfair’s SP can only be taken from their each way market
  8. Industry odds governed by weight of money and by provision of prices to SIS
  9. SPRC to consult with operators to produce a formula which most accurately reflects an operators liquidity – and therefore influence on the SP

Geoff Banks

10 June 2015

The 2015 cheltenham festival – the grubbie bookie’s view

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I suppose all racing fans grew up with great memories of Cheltenham in March. I recall as a boy, betting in the underaged class, on the Cheltenham rail into the members enclosure, nobody was surprised in those days to be served by a 13 year old – that you just couldn’t move for the absolute crush of humanity. Most of whom appeared to be called Mick. Although a few were Paddy’s. These days we’d invent a quango to count them by age, sex, social class and type of BMW

I prepare for Cheltenham months in advance by calling up the babestation offices to see if any of their talent is free. I got one. Brandy Brewer was her stage name. I think we should all have stage names, don’t you agree? So we downloaded an app (and you said I was a dinosaur?) put in our names and received new ‘porn star’ equivalents. I was Dan Cucumber. I was quite pleased with that.

I added two more lusty girls, bearing in mind sex sells. That I have absolutely no morals whatsoever. That it would upset the gambling commission. That some fellahs would hang around even after I’d emptied all their pocket change, asking daft questions like – how big are they when they’re out? You get the picture

Just in case any mary Whitehouse types were lurking, I threw in a couple of old grizzlies who have worked for me forever and never break a nail. We jumped into our Bentleys for the Cotswolds. And Mulllins.

mullins
It’s all about Mullins you see. Henderson has voted himself a non runner these days, as he declares the entire season to date as ‘soft’. The galactacos of racing who’ve won very little of late. One day they’ll whisper in his ear that cotton wooling of stars is a miserable failure, horses need to race, and the giant that is Seven Barrows will wake up to find Paul Nicholls has been eating his lunch for months. I’d like to see that, Henderson is a decent chap and we desperately need competition

The run up to the great party gives our beloved journalists to call up their three favourite trainers. Pre requisite to any convo is to get in early and often the phrase ‘it’s a privilege’ – or you’re struck off ze list of approved hacks. Lesser trainers don’t have phones and who’s interested in Hobbs or Bradstock anyway?

ATR extend ‘Bookie hour’ to a 3 hour slot daily. Tarts..

It was all about Faugheen, Vautour, Douvan, Un De Sceaux, Annie Power and Don Poli. Throw in Peace and Co for good measure. The average SP of the first 4 mentioned this year in all races? 3/10. Gripping stuff we’ve been treated to. Thanks Willie- you deserve a few quid extra in your wages at Cheltenham

Of course we know now – only one got beat, courtesy of the biggest howler in racing for many a years as she grinned at the crowd and paddled the last. Been a long time since I heard such a moan. Genuine shock – the biggest fail at the Festival since I tried chatting up Emma Spencer. Multiple bets up and down the land were waiting on her due diligence. Walsh set it up and she fluffed her lines

ap
There will be those of you, reading this, who take the view betting is the dirty end of the sport. That it’s all about breeding and the majesty of the horse. You’re the type who adores a 5 runner race. You don’t care if Faugheen is 1/6 as he powers away from horses two stone inferior. You don’t care if The New One or Annie Power are doing the same in Haydock or Leopardstown. It’s all magnificent.

Actually, you’re already dead and on the Eastbourne hall of fame. Check yourself

Well for those of you who don’t care about betting or the bookies, give yourself a pinch. Because I assume you care about the finances underpinning the sport? You want owners properly rewarded, yes? Well to educate you, the Levy Board was about to have a crisis meeting had Annie duly obliged, such would the whole have been in the finances of the sport.

ap2

(so good – I put it in twice..)

You see, racing is about the punters – they fund it. You think Steve Harman’s ‘racing right’ is coming to save you? Ha! The commercial acumen in racing has always lain with the bookies. They did their stones at Royal Ascot, King George and sundry other ‘biggies’. But you’re looking at their bottom lines – aren’t you?

trilby
Modern racing festivals these days in betting terms are characterised by ‘offers’. Credit to some firms ie Betfair (did I just plug Betfair? I need a shower! Who described their offers as what they were- free bets. Companies who did not distinguish themselves led by Paddy Power and Boylesports, who fronted with money back offers – that were nothing of the kind. I think this odious practice should be stopped. Cats being kicked into trees has to stay 🙂

On the plus side, firms like Paddy Power are giving their customers some amazing offers – I’ve never seen the likes of some of the deals they do, even if you’re only getting an extra bet, it’s still a lot more than in days of yore. What concerns me, is they’re mainly targeted at racing. It simply cannot be good for the sport for the number one festival the vehicle for ‘new business,’ rather than profiting from the racing itself. Take Peace and Co for example. A rock solid 2/1 chance for months- 4/1 in the morning. Not good, not good at all.

Brewer08_main
Thursday morning, Brandy broke a nail. It was so sudden I don’t think any of us expected it. The wailing and sobbing was akin to Annie Power’s departure from the festival. One moment – ten perfect porcelein fakes – the next- nine., Brandy wasn’t in the best of spirit. Punters were clambering over each other – not for her – but to press guinness sodden fivers in her hand for horses, fart and leave. What’s this about? This never happened at Babestation. She only had to flash her tatas and the phones would buzz. Anyway, to her eternal credit, this girl has guts for sure, she knuckled down and gave Vicky (AKA – Ritzy Jiggler) and Stephanie (Tara Cream) a hand in fending off the drunken. Some of which were bookies, a lot appeared to be jilted ex’s of Stephanie. Brandy will be back next year to entertain the masses we hope

In keeping with gambling commission edict 198.259 sub section 5 ‘dealing with total morons’ – we checked with everyone if they were over the age of 13 and not in fact in the paid employ of the commission itself trying to catch us out.

By Friday morning – I was in a shell shocked state, given depressing results, and the prospect of shaming myself on the Morning Line Saturday- my office had taken the phones off the hook and the website down. Come back Ffos Las, all is forgiven. Results outside the championship races were pretty fair – especially the ridiculous plunge on China Doll in the Queen Mother Champion Chase. Surely more likely to pull up than compete seriously?

It was a festival for the new. The performance of the meeting wasn’t the unchallenged Vautour for me – nor Faugheen, but the Denman-esque performance of Conygree. By the start of the 2nd circuit, he had many class performers firmly off the bridle. He quite simply ran them all into the ground. And who WAS that jockey??

conygree
Surely the BHA should lamp Bradstock with a 60 day ban for ‘upstaging Mullins’? Well done to the authority, however, for having the last ‘laugh’ as usual and a whip ban in the gold cup to a lesser jockey – they never disappoint

Was it the best Festival in modern times? – that’s hard to say, Loads of talking points.  it certainly was out with the old and in with the new. Everyone knows I worry about the all enveloping nature of it. Months of discussing five runner graded events and odds on chances is something a caring authority wants to take very seriously, with the prospect of a repeat next year.
I have one suggestion, which will have some people nodding in approval, the purists in horror,  and the BHA copping a deaf un. That Mares race. 6 years in a row a grade one animal reducing the worst rated event at the meeting to somewhat of a procession. Not really the point is it? Not good for the finances non plus. Perhaps an upper rating level of some description? We all know Annie Power will line up again next year – but in reality she should be in the World Hurdle, and not hiding away in selling class.      NAP

I always mention the whiners. Taking a break from the Betfair Forum. Those who moan about Channel 4’s coverage could only be uber impressed at some of the amazing images treated to our screens, the features, the slo mo’s. Fine, I’m an occasional guest, but I’m entitled to an opinion and in comparison to the beeb? No comparison. Enjoy the float race Clare. Dreadful choice over the Grand National, really it is. But we’ll have Luck and Gok- fair trade.

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And finally, yes, you made it. To one jockey. Given the amounts of cash I’ve heaved out over the years over this man, the times I’ve cursed the man, you might be surprised I’m as teary as the rest of you at the departure of a legend. I think to put it into some kind of perspective,  the British public admire most the total and unadulterred energy he put into every ride. His iron will over sometimes doubtful horses. It’s a shame Jonjos stable has been in such miserable form this season or he would have signed off with more winners. AP has carried himself wih humility and class and gave every punter 100% commitment. That’s why they love him. And I will very much miss the very engine of National Hunt Racing.

The BHA – Acting in the best interests of Racing or Stakeholders?

It’s become routine these days to hear and read informed commentators, pundits, industry experts discussing the issue of small fields in racing, indeed last year the BHA undertook an expensive consultation into fixture levels in an attempt to combat the issue of small fields and lack of competitiveness in racing.

The result? More fixtures in 2015

BHA announces races attracting small fields will be deleted from the programme

The result? No races removed, a three month trial period suddenly introduced, and one deleted race restored in the face of opposition from horsemen

9 new board members with little, or no experience running racing, at the BHA. Two of these new directors have been appointed to ‘bed in’ six of the others. Tell me you’re joking, or have the stakeholders grabbed two important ‘blockers’ on the board?

The BHA announces the scrapping of small field events to address the appeal of the sport.

The result? The BHA backs down in the face of opposition from the trainers involved in the race and the NTF. It goes further in placing an NTF official to the BHA Board. I’m sure he’ll be supportive of an initiative which followed an expensive consultation.

What’s the value in an authority that doesn’t govern the sport with its best face in mind? Someone tell me.

After the removal of the best politician we’ve ever had in charge, Paul Bittar, from the equation we’re left with an entiely new board, in every sense of the word. Opposing these new directors – the stakeholders. Betting, Owners, trainers and racetracks and their interests. And they’re clearly out for what’s best for them, even if the sport cannot progress

Do you care? Or would you classify yourself as one of the silent apathetic ones- to criticise the sport is wrong, it’s just not done. To my mind, constructive criticism is a requirement and you should get involved and stop taking the guided tour

BITTAR

Quite what the Australian did wrong or whether he had just had enough is unclear. Nobody is asking the question. I didn’t always see eye to eye with Bittar during his tenure, I’m always going to take issue with the pace of change, but it’s clear he shared many of the same concerns. Particularly in regards to ‘stakeholders’ and their negative impact on the sport, and integrity issues relating to low funded racing we seem determined to produce more thereof.  He was capable of pulling the disparate parties together given time. Continue reading “The BHA – Acting in the best interests of Racing or Stakeholders?”

Six more fixtures

I don’t want to bore you with statistics, sometimes they can prove meaningless, but there’s one stat that cannot be ignored in the sport we hold so dear. From 2008-2014, the horse population has declined by 1600, around 10%, that’s to say horses in training. In the same period – the number of races has grown by 15%. I hesitate to coin the phrase ‘the net result thereof’ – but you have to admit there appears a strong correlation in these two figures. More races – less horses..

Next year- six more fixtures. I want to make clear from the outset, I was given more than fair opportunity by the British Racing Authority to state the case on behalf of those of us who believe there’s simply too much racing. I was simply out-voted, or failed to press my arguments, indeed I think it’s fair to say my view stood pretty much alone in the face of data and reports compiled by important racing entities, to include the Racecourse Association, Arena leisure and Jockey Club. Racecourse Media Group, and Attheraces. The Levy Board also support the current level, based on data provided by big betting.

The consultation group doesn’t include any elements of Betting..

The aforementioned ‘pick five’ of racing (excluding Bet365, who oddly declined any participation, perhaps they don’t see us as serious?) Ladbrokes, Betfred, Coral, William Hill, Betfair broadly agreed with the current levels. This, despite their complaints on field sizes, elements of planning with competing fixtures devaluing certain races they sponsor, quite understandable, – that .

As to the influential Horseman’s Group? I honestly don’t know where they stand.

The BHA? As usual they get the blame, despite only controlling 200 odd fixtures themselves. One has to bear in mind, the OFT stripped the body of its powers in effect, and this is the result. I believe they definitely favour a reasonable cut. After all, the consultation was their plan. They weren’t prepared for the various stake holders to play rough, with spurious claims as to what any kind of cull would cost, without mind to the potential benefits in a raising of the bar on quality.

The sport is losing TV viewers and racegoers midweek. Bookmakers are the dominant sponsors, even if some view that as distasteful. Cheltenham lost six sponsors for their major festival races alone.  The margin in betting has seriously declined, so has racing’s market share of the betting cake and lay to lose is a cancer on the sport. I’m sure racing’s most important group of tracks would prefer to move to a more balanced sponsors book given the pervasive influence of betting, but can’t find sufficient alternate companies at the current time. After all our tv networks and newspapers are literally stuffed with adverts from gaming empires. I’m aware some of you don’t care, nor understand the long term impact of this. But a full moon is coming.

Ladbrokes, one of the largest operators in betting worldwide, have already told you of their concern as to the viability of racing as a betting product. Were you listening, or did you put it down to their failures as a company to deliver a competitive digital platform?

In order for the BHA to ‘monetise’ the sport abroad, to betting, and to new sponsors, they must deliver on field sizes, and control the level of ‘grunge’ – low quality racing put on exclusively for betting, and stop the tendency for our best meetings to compete with England vs Moldova. An instant fail.

The critical Asian market, we base some of our Levy upon, bases itself on numbers betting, – often backing several in a race. The odds permit this kind of play. How does that fit with a five runner race at Southwell? Indeed, of what interest are such events to our betting public – other than the professional players? None. Of course, I’m painfully aware to some track bosses this is of no importance right now, but change is coming with the new media rights negotiations.

In the face of the spirit of change from the Authority, Arena leisure have threatened legal action.  Yes folks, the same group who benefitted from the whole Good Friday concession is now holding the sport to ransom over their demands for a gothically dull floodlit mile for predominately low class horses at Gosforth Park. In much the same way as Pat Cosgrave was delivered back to racing – by lawyers, and their assertions. Tracks aren’t about to permit any reduction in their share of a media rights cake that has seen Bookmakers pay more than a hundred million more in recent times in fees to racing, with racetracks the primary beneficiary, and they’re not going to let a good thing go lightly..

We’ve reacted to the threat to field sizes by actually increasing the number of fixtures. Hard to believe it’s true. One is bound to question the purpose behind expensive consultation processes, other than to witness a circling of the wagons from ‘stakeholders.’ They simply refuse to countenance change, even if its utterly clear this is exactly what the sport requires to prosper.

The consultation discussed the removal of races that attracted low turnouts midweek. What’s wrong with that? It also discussed reducing the grade in certain races, to grow field sizes because we have more horses of very poor quality. This is to embark on a programme of lowering the overall quality of the programme still further. That wouldn’t be my choice, but I believe there are those who would use rocking horses if it made up a race.

All weather is on the increase, despite poor attendances, which adequately demonstrate the public have no appetite for it. The fare is largely unappealing. Racetracks focus our jewels in a one hour slot on Saturdays, often opposing more popular sports such as soccer. The midweek continues to be run down to the extreme. Sunday night racing, distressingly, has now appeared on the calendar. Nobody trumpeted that. Hardly surprising.

Few of these measures are customer focussed or about increasing quality. They evidence of an Authority boxed in the corner. Placed there by the office of fair trading. What a mess they made, ignorants with clipboards.

I’m fully aware though, there’s a strong body of fans and insiders who believe the current volume of the sport is farce.  That to prune the programme by less than 1% and move a few races about won’t change things much. It’s a view I’ve heard many times from my customers, read constantly on social networking. Most of these views are the punters of course. The vital stakeholders group in racing who don’t have a seat at the top table, as things stand currently. They are joined though by a few brave souls from the training ranks, and some well intentioned journalists.

As we keep lowering the bar on quality, we make the whole thing just that bit less interesting to bet on. The USA has seen a dramatic decline in interest and betting in the sport. Excessively dull as a product. That’s precisely where we’re heading. Believe it’s true. The global data is fully at odds from that argued by the Levy Board and Betting.

Of course, I know we can offer some superb product, and accept we can’t always have group ones. Anyone at Ascot last weekend on British Champions Day can only be thoroughly impressed by the event. Cheltenham, Aintree, York and Goodwood showcase the best of Racing. Horseracing in Britain can be utterly superb at times. I want no mistake made that I have the utmost faith in the sport. Yet we seem to be choosing the route as driven by big betting, and backed up by their highly questionable data. I don’t want to dwell on the tracks themselves. If they’re paid to race in front of empty stands, they will do just that. It’s a business. They will inevitably favour the current level. Many have impressive debt levels to service.

People are persuaded by betting by two very simple phrases. ‘Every race contributes to the Levy’ and ‘if we don’t provide racing when the punters are in the shops, we will simply sell rival products.’ Data is brought out to back up this argument. As a colleague correctly pointed out, it’s hard to take the argument for a cut in the volume of racing forward when the data appears to show we could lose substantially from any cut in the programme. I argue in a different vein. No data has been produced, nor analysed, to show what would happen to the sport’s finances were we to embark on a programme which raised the overall bar on quality. No figures have been produced to show that in fact were we to raise the average field sizes by just one – from the current average of 7 to 8 horses a race, that the extra business we would ‘field’ would more than balance any loss in the total volume. Horses would seek other opportunities.

I hope I have made that simple point well.

Let me explain big betting for those who do not understand it. No, I’m not here to discuss those who ‘get on.’ Broadly speaking, what the multiples desire is ‘product’ – lots of it. The successful supergiant will deliver as many betting opportunities as they can in an hour. Racing is marginalised as a product in comparison to gaming, which is the engine of their businesses, and other sports such as soccer. The actual number of races put on every week, make the sport relatively inexpensive to bookmakers in real terms, and they generate noise and footfall in the LBO’s. They get so many spins of the wheel. Anyone who’s remotely threatening in the modern betting environment is closed down with alacrity.

What’s our future? I believe the data rights deals racetracks have enjoyed likely heftily squeezed by the bookmakers, and we will see racetracks close.  The bookmakers simply carry far more commercial nous. Midweek racing most weeks has simply collapsed. Even our finest races ‘carve up’ between a select few, whilst lesser owners struggle at the cost of keeping their horse as the balance between prize money at the highest level and most of the programme is thoroughly disproportionate We can make more of the product.

We can grow, by embarking on a programme to cull more fixtures and move the overall quality and competitiveness right of centre. How many of you are prepared and supportive of the battle the BHA faces in forcing change, or to contribute financially towards a more interesting programme? The simple fact of life – we need a robust BHA, thoroughly in charge of what’s best for Racing. How vocal will you be in support of the surgery we actually require? I don’t see many leaders. We need a few more prepared to serve the sport and not eat its lunch.

Racetracks are feeding off rich machine based pickings from Betting, whilst many fixtures deliver a very poor product much of the time. Their focus has to be in deliverance of a better product for bettors. Not holding their hand out because 8 races makes more money than 7. Poor thinking

If I’m ever asked to stand to post and serve the sport I love in a capacity other than pricing up races, by people who seek and desire constructive change, I shall of course, but will evidently have to climb over a few stakeholders on the way! Geoff Banks October 2014

A BLUEPRINT FOR RACING

    A BLUEPRINT FOR RACING

 

Several months ago I listened to the CEO of Coral, Andy Hornby, give a keynote speech to executives at the Leaders In Racing conference.

‘Racing and Bookmakers should work together to make profit for both’ It brought tears to my eyes. ‘Our data suggests a third meeting every day increases turnover by 30% and those meetings should start around midday, this is when people break for lunch and can pop into a betting shop to wager’ He went on to muddy the words ‘turnover’ with ‘profit’. Most businessmen accept that the two don’t always go hand in hand- especially when we’re discussing gambling – but let’s not spoil a good wheez shall we?

Andy-Hornby

 

‘The ideal format has Racing approximately ten minutes apart throughout the day. Our analysis suggests more races equals more profit’

Now, for brevity I’ve paraphrased the main thrust of his argument as to re-hash any speeches at that conference puts you to sleep. But you get the idea. Of course this view is peddled by a small army of PR men from the Barking outfit every five minutes on Attheraces. Rather cleverly Coral have become the biggest sponsor in Bookmaking for racing. They do have considerable influence, one they pay for.

Of course, I also readily accept that the same argument will be peddled by William Hill, Ladbrokes and Betfred. I enjoyed a chat last week at Ascot with the Chairman of the Levy Board. A most personable chap who told me I was the first Bookmaker to advocate a cut in fixtures. This suggests some of those in authority in Racing, whenever we are talking about betting, only consult the same five firms! (if we include Betfair of course.) There are opposing – and sensible views. We are responsible for just under 20% of the market  – that merits consideration

Turnover and market share is down in racing, so let’s deal with the problem by putting on more racing, in the worst slots, and work with reduced field sizes.  I think most people readily agree it lowers the quality. That’s demonstrably wrong. Let me explain

You see, the empirical evidence paints a completely different picture. At the foot of this report, I invite you to view the presentation by Jennifer Owens, a research consultant for Aspire Wealth, tasked with investigating the state of the Racing and Betting market globally. Again I spare you the full details, but let’s deal with comments affecting Andy Hornby’s argument.

‘Since 2006 Great Britain is scheduling more races. Whilst amounts wagered between 2006 and 2013 have dropped dramatically. In the period between 2001 and 2012, the number of runners per race fell from 11.6 per race to 9.3. Sports betting in the meantime grew from 58% to 72% between 2003 and 2013. Hong Kong, with its competitive fields and less racing was the standout performer worldwide for betting on racing. Indeed that state’s turnover on horse racing remained constant despite a 30% increase in sports betting in the territory’

She goes on ‘The most striking example which was quite damaging to British Racing was the introduction of gaming machines into UK betting shops. FOBT’s account for 38% of gross win in the UK – just as well they are limited to four machines per shop.’ The lady took no prisoners.

Fixed odds betting terminals

Jennifer continues ‘There is evidence that field sizes and turnover are correlated – at least in the negative. The greatest declines in turnover have been witnessed in the US and Great Britain since 2006, and in these markets the field sizes have dropped dramatically.’ ‘In many markets Racing has become disconnected from Betting.’ In broad terms racing governance doesn’t engage the right type of people to maximise it’s output and we need to turn around the field size problem urgently in her expert opinion.

Anyway I digress. What conclusion can we draw from this intelligent appraisal? Well if her numbers are correct, and I think it’s reasonable to suggest they are, Andy Hornby is talking out of his corporate backside. The global view on betting doesn’t in any way support his stance that more racing engenders more levy. Quite the opposite. In fact the most successful state for betting in the world only races six times a month. Hong Kong.

Let’s put it simply, and honestly. Racing needs to tell the Bookmakers where to get off. You see our great sport is a vital cog in their wheel. If racing doesn’t fill the ten minute gap Andy requires, he will simply turn to another product to make the place look busy. Greyhounds, virtual, Australian and French racing are all fit for purpose here. British Racing doesn’t have to prostitute it’s product in order to keep shops open. Gross win across the counter has been dropping between 5%-6% since 1998 and there’s little doubt the major operators focus their advertising on machine take- not racing. So why are we bending over for organisations who don’t promote the sport? Or perhaps you draw a different inference from the picture which typifies these companies.

lbo2

I don’t know about everyone else, but I do know my turnover on the far better funded Irish Racing runs at around 9% of my racing turnover – yet it’s ill-considered as a product against the British one,  timing of the races are not synchronised with their UK equivalent, nor do we earn levy from wagering upon it. That seems fairly odd to me.

Will some shops close? Inevitably. But let’s not kid ourselves, these are the worst performing money factories, often competing with other LBO’s in the same street or district and whose machine gross win (typically industry wide figure of £3600 per week per shop) is unable to support the unit in some areas, where the FOBT take is insufficient. This is natural forces and we shouldn’t be wailing if a few of them go to the wall. Proliferation of betting shops isn’t about racing. We’re not going to improve our levy yield because we have another shop 200 yards away, most people can struggle that far for a bet. Hell, I bet Newham would be thrilled to see a few less squeezing into their High Street.

The period between 2002 and 2008 with fixtures growing from 1270 to 1548 and a levy yield which also grew modestly fooled some folk.  Those years actually witnessed a decline in the numbers of people actually going racing, not only per fixture, but overall . The new meetings were in unattractive slots. They diluted competition in racing by spreading the available horse population more thinly. Some tracks found they were in fact weakening their own other fixtures. If people aren’t going racing- they sure as hell aren’t betting. We’ve lost the impetus and this is no more illustrated in racing than the depressed state of the On Course market. Racing to empty stadia has become rather par for the course with ticket prices people simply do not want to pay by cynical management. Selling ’empty space’ with a notable lack of effort. Put another way – racing is heading to the dogs and become reliant on festivals. Pass the port will you?

Tracks are guilty of putting on events without thought or involvement for the production of competitive fields and the size thereof. 38% of all races are won by the favourites, 2 in every 5 races! That’s a fantastic statistic and evidence of the transparent nature of the sport.Not only are the favourites the legitimate ones, but lets face it, the drifters run appropriately as unscrupulous connections take advantage of a no lose opportunity! Little geo-location of fixtures is evident, in order that the available local horse population, and attendances, could service the same. We do not properly consider the cost of staging fixtures like Ffos Las- which even if it’s a self funded two mile hurdle race with two fences hundreds of miles from civilisation, still has a significant attaching integrity cost to operate.

Finally, and perhaps most damaging, racetracks have shifted fixtures from their traditional midweek slots to weekends. To include many premier races. The Stewards Cup. The Ebor, The Derby, and more. All moved from midweek slots where they were the focus of most newspapers and TV networks as well as general sporting fans, to ones where racing found itself competing with England vs Costa Rica. Simple for Racetracks- a disaster for the profile and numbers of the sport. Expect RMG to argue over loss in income, although it both ignores the cost involved in racing to empty stands and the the sheer lack of data backing their stance. Footfall and beer sales are all furthered by Saturday racing. We glibly criticise Channel 4 for poor viewing figures when we feed them a diet of 5 runner races. Although I agree – the burger van HAS to go 🙂

Such moves put top racetracks in direct competition with each other. Ascot, Britain’s premier course regularly competes with York for coverage and exposure. Our Champions Day sees Cheltenham competing with Ascot for coverage. It’s not unusual to witness these three top courses rivalling Chester and Newmarket along with sundry smaller tracks for attention.

july

In what other industry would you create a programme so devoid of interest midweek? A bit like Waitrose emptying its shelves of fresh vegetables and offering us tinned plums instead.

As a business plan, Saturday focus demonstrably fails the quality test. Our best racing in direct competition to top sport, particularly football and rugby. We have a Derby opposed by 8 other meetings on the same day! Let me stress this, Lingfield just down the road opposes the Derby.

Punters, those who shall not be heard, have been telling me for several years now they tire of the glut of racing.  Newspapers and TV networks to include the BBC have dropped the sport in part or whole. Racing Journalists are getting laid off. Put very simply we’re boring the pants off people and running the sport into the ground to keep Coral in machine take and racetracks putting the sport on in front of nobody. An industry servicing machines

This isn’t our game face surely? Positively it’s one the BHA Chairman, who’s emerged from hiding and appears now to want to address with his new consultation into the fixture list. If required I will be part of any quorum and/or meeting or analysis to press this case.

This consultation will inevitably bring the sport into conflict with the likes of Tony Kelly and Simon Bazelgette et al. They’re not likely to give up the easy dollars they earn annually from media rights with jewels like Kempton and Southwell, with arguments like what will we lose rather than what does it cost.  The media rights cake envisaged in 2018 won’t be a patch on what they’re earning right now if we continue on the path of 6 runner races and odds on chances. Bookies won’t peddle an unprofitable product riddled with favourites hosing up through lack of competition. There’s evidence right now the betting share for racing is well down. So what are we selling the bookmakers, or rather more pertinent – asking them to sell for us?

It does require the turkeys to vote for Christmas as things currently stand and forego an element of beer sales. There appears to be a view if we put up 38 grand we’ll end up with a quality Brigadier Gerard. In fact we ended up with a short field, odds on chance event. In betting terms it’s useless.. It’s not JCR’s fault and I’m not suggesting that. There are, quite simply, far too many opportunities for our wealthiest owners and a racetrack focus on such owners. They’re not turning down the 38 grand- they know they’ll get it somewhere else..  We’re looking after the top horsemen. All very well, but what happens to betting in such races?

Racegoers celebrate after the William Hi

The juggernaut that is British Racing is finally starting to recognise that any way you cut it, 1548 fixtures is simply far too many. We can tinker with the planning but we’re not going to make the product that much more competitive which is what both bookies and punters want. We also have to properly consider the effect of small fields on interest abroad. I would settle for a modest cut for now to examine the impact on field sizes. I think most would.

I have absolutely no clue why we accept a jumps programme so geared upon four days in March. The power of best trainers, has to be curbed and measures put in place to insist our top animals race in front of paying customers and telly and not afforded racecourse gallops by pliant courses. I’m constantly amused by stories from Seven Barrows of athletic and evidently agrophobic pets only fit to work 3 times a year. Send the buggars out to work.  NH suffers from some of the lowest fields in the sport and we need seriously to look at the abandonment of summer jumping completely in favour of the winter. It never used to take place in August and I fail to evidence the compelling reason for it now. Betting turnover on summer jumping in racing is extremely poor (typically lower than AWT). It’s an area of the programme that needs to be sacrificed

I chatted to several of my on course peers after Ascot. It’s readily accepted the meeting was a complete disaster for Bookies generally – expect a few profit warnings! What was remarkable was that most of my colleagues betting at Ascot actually turned a profit, when they should have done their brains! These days to turn up as a Bookie, post general market odds and stand back waiting to see who backs what, is a recipe for failure on course. Most of the larger concerns find betting on course impossible because they don’t ‘trade’ the wagers on exchanges. It’s a total necessity if you are to make racecourse bookmaking pay as a business. However the much wider industry still continues to accept prices that more often than not mirror exchange odds, and can be based on some individuals betting win only, or a fifth of the odds on a 16-21 runner handicap.

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At the midweek and sundry ‘weaker’ meetings the on course market has become excessively weak and totally ruled by exchanges for their prices. I watched a major operator’s rep at York run around recently telling folk he wasn’t going to invest with certain organisations because they weren’t in the 20 firm ‘sample’ that’s used to return odds to the LBO’s. Therefore for such organisations to control a particular horse’s SP, they only have to wager with the ‘sample’ organisations, and ignore the other 90 bookies. It costs but a fraction of what it used to, to move the SP of a runner at a major track like York. At the weaker meetings like Kempton, frequented by the smallest weakest bookmakers, it’s pathetically easy with but a few grand to influence prices. What self-respecting bookmaker is going to turn down £300 from the majors when they’re only holding that much per race? Manipulation on the cheap. And a market and exchange so easy to control these days doesn’t encourage laying.

I do think we are long past the time where the potential profits from a healthy industry are governed by a deeply unhealthy one. That is the on course market. They simply need to be excised from current arrangements. I’ll use a dirty phrase. Industry prices. At the end of the day, they are more representative of the weight of money. The days of John Banks and Colin Webster in trilbies and shades standing horses for £30,000 are long gone and so are the arrangements put in place in those days for producing a fair SP. It no longer represents the industry. I believe the major Bookmakers – tote and exchanges all need to be part of a new mechanism, not Martyn of Leicester – he of the plastic shoes. Next time I go racing- I fancy I’ll be stoned alive. Fair enough, it’s better than the results

To the racecourse Bookies I say this. As the off track prices inevitably dip – so the on course market’s odds become more attractive to punters. A path to new business. We neither need, nor deserve to be part of a mechanism when there’s only a handful of us, betting to pennies and following cyber betting bots.

 

Kick these suggestions around

 

A maximum of two (Levy and Media Rights) funded premier events on any day.

 

Premier events to be incentivised to move from Saturday slots with appropriate increases in rights and levy

 

Racetracks to be penalised with total loss of funding for production of races under 5 runners.

 

Racetracks to be rewarded with increased payments for producing field sizes exceeding 10 runners

 

Racetracks funding to decrease for each race containing an odds on favourite and increased for any race where the favourite goes off at 5/1 or better.

 

No All Weather racing to be programmed in the summer in opposition to key festival events such as the Derby

 

Summer jumping programme to be scrapped for two months.

 

Race planning to fully consider Geo location factors

 

A minimum number of qualifying events for entries for Cheltenham

 

A modest cut of 100 fixtures

BHA to create a betting forum with representatives from both large and small Bookmaking concerns, punters and racetrack management with mandate to improve betting turnover on the sport

SP Mechanism to exclude racecourse bookmakers and to include the major 6 operators to include the Tote and Betfair in a new mechanism based on the weight of money

 Coral to reintroduce the blonde to their adverts. It was the only betting advert worth watching..

 

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These plans will affect income streams of some and put other people’s noses out. I’m not, however in the business of making myself popular amd I think my chances of making the Jockey Club are a bit slim 🙂  Of course I understand some of us turn left on aircraft and don’t worry about what’s happening in the back of the plane. How much it costs, whether they’re drinking from a real glass, and what film, if any, they’re enjoying. But such individuals must be viewing the approach of 2018 – when the Turf TV contract expires with firms like William Hill with some trepidation. If you’re sitting there thinking the racing is ‘terrific’ and Bookies should pay more for the product because they have offshore wings making bundles out of the sport, you need to excuse yourself from the room. UK Racing is, quite simply, the weakest betting product globally. Let’s not get snobbish about betting – it’s the engine that drives the sport.

These suggestions will have racecourses reaching for their calculators and the big Bookmakers shuffling their PR crews out to protect ‘their’ business model. The argument shops will close if we don’t come ‘to the rescue’ simply isn’t the case. The strongest product for bookmakers remains horses – and the better quality that is, the better for LBO’s. Of course the measures are quite radical, but I think we have to accept a degree of surgery. Next time you pass your local betting shop – see what they’re peddlng in the window. Right now – it isn’t Racing

You have a voice. Use it

Geoff Banks

June 2014

Link

http://www.archk2014.com/en/2014-arc-video-06052014.aspx