Australia: New Betfair deal with Tasmania

The deal between TOTE Tasmania and Betfair means Betfair will be able to offer its 1.1 million punters "exotic" bets, such as quinellas, trifectas and quadrellas, for the first time. It will also receive an undisclosed share of revenue for acting as TOTE Tasmania’s agent, while TOTE’s turnover is expected to increase by us$ 50 million to us$ 60 million a year.

The deal, announced in Melbourne and Hobart yesterday, is a "win, win" for Betfair and horse racing in Tasmania, which is expected to enjoy extra revenue of at least us$ 10 million a year. While there will be flow-on benefits due to racing nationally, the deal is exclusive in terms of providing Betfair access to the national SuperTAB racing pools.

Tasmanian Treasurer Michael Aird said while that may not please interstate TABs, they should have seen it coming, after the island state in 2006 became the first state to provide Betfair a licence to operate in Australia. "I don’t think anyone in the racing industry observing this announcement today would be surprised by it," Aird said.

"But yes, we are at the forefront and cutting edge of dealing with this industry to put it on a sustainable basis. If we didn’t grow our market, we wouldn’t be able to provide the kind of dividends we need to put back into the racing industry. Obviously, some of our competitors will be not too pleased, but in private would understand that this was the logical conclusion to the arrangement (between Tasmania and Betfair)."

Under the deal, Betfair has funded a new webpage, on its own site, allowing its punters around the world to place bets via TOTE Tasmania, using their Betfair accounts. It matches punters’ bets, much as stock exchange matches buyers and sellers of stock.

The TOTE deal will allow it to act as "one stop shop" also offering its punters access to quinellas, exactas, trifectas, doubles, quadrellas, as well as win and place.

"The most significant aspect is that it will be bringing in new customers and new money to TOTE Tasmania and the SuperTAB," said Betfair CEO Anthony Klok. TOTE Tasmania CEO Craig Coleman said from May, when the new service begins, Betfair would market Australian racing to more than a million registered customers in the United Kingdom.

"It is a logical step for the national racing industry to offer racing to a new set of international clients," Coleman said. Robert Nason, Tabcorp wagering manager and a past critic of Betfair, declined to comment yesterday.

The latest Tasmanian-Betfair detail will also aid taxpayers in the apple isle, helping the State Government-owned TOTE return to providing annual dividend payments. This follows a two-year "dividend holiday" in the wake of the equine influenza crisis.

Punters in every state and territory can legally use Betfair, after the High Court last month ruled a Western Australian ban was unconstitutional. However, all jurisdictions except Queensland and Tasmania ban the advertising of betting exchanges.