It's a pity the CEO of Phumelela doesn't stick his nose into the history books rather then the Kleenex box as he now whines to government for additional support for his monopoly rather than ask himself and his lavishly paid directors : How do we grow this business?
Here's a brief 'Betting history lesson' which appears to have totally escaped him :
Bookmakers : When I started racing in 1972 the deduction paid by bookmakers on winning bets was 7,5%. In the years that followed this increased to 10% and thereafter to 12%.
It is no secret - as any bookmaker from that era will tell you - that when it reached 12% punters cried : Enough. Betting with bookmakers effectively turned into a bucket shop operation.
I was clerking for a bookmaker at the time and we used to record bets as follows : 10% of the bet was put 'in the book' and attracted tax whilst 90% went 'on the side' and attracted Nil tax. Dependent upon the client some ( or all ) of this tax would be rebated to the punter. Or not.
As far as the province was concerned betting on horses was in terminal decline as declared activity went into freefall.
After awhile the light bulb lit up and the tax was reduced to 6%. About 99% of bookmakers then reverted back to putting all bets 'in the book' and revenue to the clubs and provinces increased massively.
Lesson ? You cannot arbitrarily tax anyone beyond a certain level without a reaction.
Then came Betfair. The regulators no doubt proudly believe that they have been very clever by having online betting banned.
I am sure their forefathers would have felt equally smug had they banned motorcars a century or so ago when that development threatened horse based transport!
But who is the donkey in this equation? Possibly them!
There are a number of facets to betting exchanges which appear to be totally escaping the regulators. And which offer the opportunity of vastly expanding the support that racing should enjoy.
1.) At present racing receives only 3% of winning bets from bookmakers. If betting exchanges were to be legitimised is there any reason why the founding arrangment could not provide for a higher takeout of, say, 4% - which immediately improves revenue from this source by 33%.
2.) It seems to completely escape the attention of the operators that this medium is likely to draw 'new blood' into the horse betting market. ( It is highly unlikely to affect their tote punters sitting in off course facilities as they are sitting there BECAUSE they often cannot afford online technology! Duh. ).
3.) It would introduce punters to 'in running' betting on horses. I have been idly monitoring on line action in the UK and it seems to boost the pot by about 30% - 40% in each race after the 'off'.
4.) Exchanges definitely boost turnover as they lure punters into betting when they don't have a 'fancy' but rather have a 'it cannot win' opinion.
Thank goodness this inept 'leadership' never worked for Telkom - we would still be waiting for the cellphone!
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