Does the sport of kings rely on subsidies from the bookmakers and FOBTs?
The Campaign for Fairer Gambling addresses concerns which many have that a reduction in gambling on fixed odds betting terminals (FOBTs) would leave the sport of horseracing short changed through a reduction in the levy it receives.
The Racing Post is the bookies’ trade newspaper with a circulation of around five per betting shop and which relies on bookmaker advertising. It is therefore commercially biased against any action that the bookies don’t like. This is why it’s been parroting the bookies’ lines on FOBTs as if they are facts rather than the usual misleading spin.
It also profits from acting as an affiliate, steering gamblers to remote gambling sites with the marketing of unfair bonus offers that are typical of those being investigated by the Competition and Markets Authority as possibly in breach of consumer protection law.
The Racing Post is owned by Exponent Private Equity, which has more than £2 billion invested in a portfolio of over twenty companies. The team at Exponent might be nice people, but they are acting on behalf of themselves and wealthy investors. It is very unhealthy for democracy and society when biased media reports protect the commercial interests of the wealthy through dismissing the harm and socio-economic costs of FOBT gambling.
Similarly, some in the UK Horseracing sector are speaking out against restrictions on FOBTs. The theory is that betting shop closures will result in reduced revenue to the BHA, which could harm horseracing.
The main bookmaker support for horseracing is from a levy calculated based on the turnover of bets on racing, a fee is also paid per betting shop to show live racing. Restricting stakes on FOBTs should result in some crossover back to over the counter race and sports betting, which would increase the levy, as Greg Wood argued in the Guardian recently. But Ladbrokes boss Jim Mullen claims there is no evidence that this would happen, so the BHA parrot the misleading story that horseracing would suffer from a reduced levy.
Of course, Mr Mullen also says there is no evidence that reducing FOBT stakes would reduce gambling harm, so we know how reliable his opinion is. It is fascinating how the bookies can put up prices in so many events without knowing the outcome, based on best estimates, but apparently lack the ability to project product crossover in their own business!
Practically no one goes into a betting shop for the first time to use a FOBT. They aren’t marketed. Betting shop staff are incentivised to convert racing and sports bettors to FOBTs, through free bets and promotions. This crossover wouldn’t happen if they stopped doing that.
ARC is a racecourse owner which accounts for 40% of horse racing fixtures and turns over around £90 million per year. This great British enterprise is owned by Racing Holdings Ltd which is owned by Omaha Business Holdings Corp, both of which are based in the British Virgin Islands – a tax haven.
Ultimately, they are owned by the Rueben Brothers who are in the top 100 Rich List. If Theresa May is serious about taking on big business and acting in the interests of the many, she won’t put protecting the leisure pursuits of the 0.1% ahead of curtailing the social harm FOBTs are causing, having extracted £1.8 billion out of local communities last year alone.
The government’s agenda is very restricted, in part because of Brexit, but its gambling review is an opportunity for Theresa May to put her reported “Red Toryism” into practice.
The bookies’ trade body, the ABB, will be targeting MPs who have racecourses in their constituency, using the ABB’s interpretation of their secret, industry-commissioned KPMG report. After an expose in The Times, politicians would do well to ignore this – at least until it’s made available for public scrutiny.