There have been many false dawns during racing’s long, wearisome trudge towards a modern, commercial funding system to replace the Levy and earn a fair return from bookmakers. Tuesday’s announcement that racing - or the British Horseracing Authority and the country’s two largest racecourse groups, at any rate - intends to get tough on offshore bookies who pay little or nothing to the sport, could yet prove to be another.
For one thing, racing is not, for the moment at least, offering a united front. The handful of major tracks that are not owned either by Jockey Club Racecourses (JCR) or Arena Racing Company (Arc) - including Ascot, York and Newbury - have not, as yet, agreed to refuse new sponsorships by bookmakers who do not achieve Authorised Betting Partner status. If the non-payers, which includes major firms like Paddy Power, Boylesports and SkyBet, are able to directly point their considerable promotional budgets towards those tracks instead, they may be able to live with a sponsorship ban elsewhere.
But the combination of the BHA, JCR and Arc is a fair starting point, and if there was one word that stood out as Nick Rust, the BHA’s chief executive, talked about the initiative on Tuesday, it was “confidence”.
Rust, who has been a senior executive with two major bookmaking firms and has a fair idea about how the balance sheet looks, still believes that a Racing Right will be necessary to compel bookies to pay a fair share of their profits to the sport. Whether or not the necessary legislation will make it through parliament this side of 2020 remains the subject of considerable doubt, however, and the Right seems sure to face challenges in both the domestic and European courts - assuming that the latter still applies - even if it does.
In the meantime, though, racing is not sitting around and waiting for the government to grind into action. Sponsorship money from bookmakers is an important source of funding, but every pound that comes into racing now which promotes the website of an offshore, non-paying bookie also undermines the sport’s long-term financial foundations.
Racing is now doing something which could have a significant downside in the short term, but still prove worthwhile in the long run.
“Over the years,” Rust said on Tuesday, “there have been some people inside racing who have talked about divine rights [to betting money] and the old enemy and that side of things. Thankfully, on joining this side of the fence, I don’t see too much of that but there are still vestiges of that around from time to time.
“The point here is that we know that our product is quite attractive and it provides a gateway to betting customers who bet on other things. It may not be the introductory product it was 20 years ago, but it is still a very important part of the diet of the British bettor and I think we have to have a little bit of confidence in ourselves and press forward on that basis, rather than trying to please everybody as perhaps we’ve done from time to time. And I think we must recognise and look after those [bookmakers] who wish to stay inside the tent, and that is the driving motive.”
Co-operation, in other words. There are, as Rust says, some, possibly many, within racing who hate the idea and want to squeeze the bookies until they scream but the bookies are not the customers. They make money from the people who lose it, and in a genuinely commercial system, what they keep will be, in effect, their commission for handling the betting side of racing’s business model.
The best way to get them into “the tent” is to make it worth their while, not force them inside at the point of a gun. This is a point that the big firms’ shareholders will appreciate, even if some of the more stubborn CEOs do not. The maths is fairly simple: if a bookie is required to pay over, say, 10.75% of gross profits, then the difference between being inside and out need only be 11% to make it a no-brainer.
If racing can manage that, via a combination of tempting goodies for the bookies that pay and irritating obstacles for those that don’t, it could even remove the need for a Racing Right completely. Racing and betting sorting out their decades-old differences like intelligent adults might seem an extraordinary concept, but this was a day when, possibly, it became just a little more plausible.
