BUSINESS

Tabcorp to renew NSW bet monopoly; Tatts files new suit against Victoria

TAGs: Australia, New South Wales, pokies, Tabcorp, Tatts Group, Victoria

tabcorp-tatts-group-australiaAustralian corporate bookie Tabcorp appears to be on track to renew its retail betting monopoly in the state of New South Wales. Tabcorp’s existing NSW deal expires June 22, and NSW had hoped to boost its licensing revenue by pitting Tabcorp against rival bookies in a bidding war. But Sportingbet CEO Michael Sullivan has already stated that obtaining the NSW operating license was not a priority, and Sportsbet CEO Cormac Barry, who stated earlier this month that he’d consider a bid if Tabcorp and NSW couldn’t come to terms, has apparently misplaced his checkbook. The Australian Financial Review reported that Tabcorp is likely to pay NSW $50m to renew its license plus an undetermined fee to retain its monopoly.

In Victoria, Tatts Group has followed Tabcorp’s lead in suing the state government over its imposition of a $42.6m health benefit levy on Tatts’ video poker (pokies) machine operations. Trouble is, Victoria is basing the amount of the levy on the full 2012/13 financial year, whereas Tatts only operated pokies in Victoria for the first 46 days of that year. Tatts and Tabcorp formerly held a nearly two-decade-long pokies duopoly in Victoria, but that came to an end last August. Tatts and Tabcorp have each filed suit against Victoria seeking hundreds of millions of dollars in compensation for the loss of their pig in a pokie.

Tabcorp filed suit over Victoria’s pursuit of a $42m levy earlier this month but Tatts held off, saying it hoped to negotiate a mutually acceptable compromise with the state. On Wednesday, Tatts said bollocks to all that, filing suit against Victorian Treasurer Michael O’Brien in the state Supreme Court. Chief among Tatts’ arguments is that it only earned $29m in pokie revenue during its 46 days of pokie purveying, a little over two-thirds the levy sought by Victoria.

Pokies are the overwhelmingly dominant form of betting in Australia, accounting for 71% of the total $160.4b punters spent on all forms of gambling in 2009-2010 (according to the most recent Australian Gambling Statistics report). Victoria ranked second among states in pokies spending, notching an incredible $9,956 bet per adult (behind only NSW at $11,773). Sports betting, which has earned all the negative press of late, accounted for a mere 2% of Australians’ total gambling spend, although sports betting turnover rose 19.6% from the previous year.

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