Racing Victoria, which governs thoroughbred horseracing in the Australian state of Victoria, is to increase fees charged for “race fields” from 1 July in a move that will have a major financial impact on online bookmakers in particular.
The fee for race fields is for use of racecard data only and fixed-odds and betting exchange operators like Betfair, Ladbrokes, Paddy Power, Sportingbet and William Hill, as well as Tabcorp which operates tote and fixed-odds betting, will all have to pay significantly more going forward. An analyst estimated the increase in fees would cost Paddy Power more than R50 million annually and William Hill about R40 million.
Racing Victoria has said that the new fee model will differentiate between tote betting on one hand and fixed odds and exchange betting on the other.
The aim is to increase revenue, especially from increasingly popular online bookmakers.
The new fee structure for non-tote betting is tiered and bookmakers will have to pay a percentage of turnover or gross revenue, whichever is the greater. The percentage will increase depending on the quality of the race meeting.
From 1 July fees will range from the higher of 1.5% of turnover or 15% of gross revenue for standard race meetings (no Listed or Graded races carded) to 3% of turnover or 30% of gross revenue for 10 premium Grade 1 race meetings.
Tote betting operators will have to pay 1.5% of turnover for standard meetings, 2% for graded or listed race meetings and 2.5% for the premium Grade 1 meetings.
Racing Victoria chief executive Bernard Saundry said: “Wagering revenues through race fields fees play an important part in maintaining the economic growth of racing in Victoria and these changes will provide racing with funding to invest back into the continued development of the sport.
“Pari-mutuel (tote) betting has been the main funding source for the industry for many years, however there has been a significant shift in the market towards non pari-mutuel bet types including fixed odds, best tote and exotic multiples.”
He added: “This new fee model will help to grow the industry, allowing us to protect jobs and sustain the Victorian racing industry well into the future.”
It’s on the cards that Racing NSW and Racing Queensland will increase their fees for race fields later this year. Bookmakers in Australia have had to contribute more to the cost of staging horseracing since 2012, when the High Court significantly ruled that Racing NSW had the right to charge corporate bookmakers on betting turnover and not on revenue or gross profits.