MONDAY 12 APRIL, THE FOUR SEASONS HOTEL SYDNEY
By ALAN JONES AO
NATIONAL BROADCASTER, FORMER AUSTRALIAN RUGBY UNION COACH, FORMER DEPUTY CHAIRMAN OF THE AUSTRALIAN SPORTS COMMISSION
Thank you for the kind invitation to be with you on the occasion of the 33rd Asian Racing Conference with the challenging theme of “Racing Into The Future”.
The theme conjures up many images. But it also invites the obvious conclusion, that it’s no use racing anywhere unless you first know your destination. There’s nothing worse, as we all know, than being in a race of any kind only to find ourselves side-tracked up the wrong road.
I don’t think there’s any risk of being side-tracked this week. May I congratulate the organisers on putting together such a diverse set of presentations and may I say to our most welcome visitors, I hope you’ve really had a chance to enjoy the social programme. And I notice on Thursday there’s an opportunity for a Hunter Valley stud tour which, if you’ve done nothing else, I would thoroughly recommend. The morning tea at Government House tomorrow morning will enable you to marvel, from a unique standpoint, at the glorious panorama that our city offers.
As you are aware, the subject of my address is Racing’s Destiny, the Path to Success. I have to say in getting here today, I felt that the process was something of a metaphor of the racing industry itself.
I was first asked to present an extract of what I might be saying and that was asked of me months ago. And then a further request, very courteously couched I might add, about guidelines for my presentation, whether I’d be offering a powerpoint version or a movie presentation, whether that would be in Quick Time or Windows Media format, whether my presentation had been prepared on a Macintosh, whether in fact it included an embedded movie. I haven’t yet divined what an embedded movie is. But it all caused more than a little head spinning.
And I couldn’t help but feel that our being here today is about a relatively simple issue, the glory, the adventure and the challenge of the sport of horse racing. And where there are challenges, they are not of a dimension that requires anything too complicated to properly articulate them.
So I’ll be casting all that sophisticated technology and presentational jargon aside and hopefully navigate my way through some of the problems as I see them in order to present the platform for success that we all seek.
It is true that times change.
And even racing, a traditional sport, was developed in an era when there were few leisure and gambling activities.
It’s a different world today.
And the challenge is for our sport to evolve without losing its traditional charm.
Change always brings challenge.
You manage change by responding beneficially to the challenges, and there are a number of them facing us today in Australia which are not particular to Australia.
Many of these challenges face the industry worldwide.
In politics they say that disunity is death.
So is it too in families and so is it in the family of racing.
To our international friends I should say that things are made a little more complicated in our country because in racing, each of our States has its own administration.
However, the notion that competition within our industry is good is something of a myth.
Our real competitors are external ones, other forms of sport and leisure.
Other gambling activities.
In those circumstances, to prevail, unity is important if we’re to offer the best programmes, the best racing experience and a consistency in the quality of the product throughout the whole of Australia.
Only through unity can we make ourselves stronger.
For us here in Sydney, that means consolidation within the metropolitan area by getting clubs to join together; having one set of administrators; lessening the cost; but most importantly having strategic decisions that are going to affect our industry made by one group rather than by separate groups all taking a different view.
We can flirt with the notion that we do have a sense of unity because we’re unified under the Australian Racing Board.
But that is a mirage.
We have competing clubs and competing States.
Someone was making the point to me only the other day that you’ve got a gigantic international conglomerate like BHP Billiton which is run by a board of ten.
Whereas New South Wales racing alone needs two boards of ten, the STC and the AJC and another board of five for Racing New South Wales.
So we’ve got 25 people running metropolitan New South Wales racing and a board of ten running the world operation of BHP Billiton.
That doesn’t sound like the proper organisational model.
And it’s not a model that serves the quality of the product that we can offer.
But we also have to be unapologetic in insisting that we get paid for the product that others are using for their financial benefit.
And I’m referring to corporate bookmakers and betting exchanges.
We welcome these mediums which offer punters a broader variety of opportunities for betting, but we’re entitled to insist, as an industry, that we be paid.
As you know, the international transfer price for race fields, that is when race fields are bet on in Australia and shown on Australian TV from the United States or Hong Kong, that transfer price is a 3 per cent fee.
Through legislation in New South Wales, we put a one and a half per cent fee on race fields, half the international transfer price.
But corporate bookmakers are challenging that legislation and instead say they’ll offer 10 per cent of their gross profits.
But they also claim that their gross profits are 5 per cent of their turnover, so 10 per cent of 5 per cent is half a per cent on turnover.
And who has control over gross profit?
We all know those figures can be manipulated.
Indeed the gross profit levels of these entities, bookmakers and betting exchanges, are out of our control.
People can run their business badly and make no profit.
In other words they can use our product for no benefit to us.
It is ludicrous to link the use of our race fields with the profitability of the user.
Surely as with any other product, you pay your fee for using it and you do your best with it, according to your own model.
Now as we know, that’s being fought out in the courts at the moment, but it is a very significant challenge for the industry.
A fee of one and a half per cent would provide in the vicinity of a 50 million dollar difference every year to our State here in New South Wales, which would dramatically improve the level of prize money, infrastructure and the promotion and marketing of our product.
And this corporate bookmaking issue is a worldwide one.
They use not only horse racing fields but soccer competitions, Rugby League, AFL and other sports, in all their various permutations, and seem to be saying that they should only pay a minuscule amount for the use of those products.
As an aside, I am more than amused and sometimes angered when the racing industry’s television outlet in this country, TVN, owned by the race clubs, has as its major sponsor and supporter the bookmakers.
And indeed the same bookmakers and betting exchanges are actually promoted by on-air presenters paid for by the racing industry, espousing the benefits of bookmakers who in my view are currently putting at risk the future of the industry.
No one wants to exterminate corporate bookmakers.
But the pathway to the success of this industry in