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LightsOut

Sundays laugh brought to you by John Allen & Paddy Power

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Unfortunately once you read below you will realise that the only one having a laugh are the Paddy Power Shareholders at the expense of the NZ Racing Industry..

John Allen was on a panel over 18 months ago to look into how the NZ Racing Industry could combat overseas betting leakage on its product. He on behalf of his General Manager of Sports and Racing Glen Saville sold the proposal to the NZRB Board to have Paddy Power become partners with the NZRB over their co-mingling wagering partners TABCORP.  TABCORP pay race fees to the NZ Industry and rightly so NZ reciprocate the same back in fees to Australia. Why would you partner with a Company who doesn't pay your Industry (both racing and sporting codes) fees to take your product when that Company is going to be sharing between one other company (Openbet) annual income of costings to the NZ Racing Industry of $17 million dollars.

This link below was Paddy Powers stance on submissions to the Government over fees to be paid to the NZ Racing Industry (Sporstbet & Betfair are both  owned by Paddy Power). Extract from the link - Proposal 4: A consumption fee for offshore gambling operators accepting bets from New Zealand 7. 'The AWC and its members (namely Paddy Power) are profoundly opposed to this proposal.'

https://www.dia.govt.nz/diawebsite.nsf/Files/Racing-Act-consultation-submitters/$file/3-Australian-Wagering-Council.pdf

In 2016 Paddy Powers Betfair signed up with New Jersey Harness Racing to offer punters their exchange betting and increased their take out rate to Betfair customers to 12% from the usual 5% to provide income to the New Jeresy Racing Industry yet this Partnership subsidiary of Paddy Power continues to take from NZ Racing Industry and return nothing.

 Betfair charges its customers 2 to 5 percent of any winning bet. It does not charge a commission on losing bets. In Australia and the U.K., the company pays approximately 10 percent of its commissions back to the racing industries  https://classic.drf.com/news/betfair-funded-study-favors-exchange-betting  .  So why are they not paying the NZ Racing Industry the same return as what they pay to Australia and the UK, remembering this is part of a Company now in partnership with the NZRB. 

You have to ask yourself what any Company owner or Board would do if senior management had allowed the Company they are employed by to sign a partnership agreement that sees them screwed over for millions of dollars.  

John Allen on the panel to look at leakage and as the CEO of the NZRB the first thing you do is to stop Betfair taking live feed streaming of your product for their customers to bet on with no return to the NZ Racing Industry. You say if you want our live feed you pay for it. You don't do that and then the Company signs to be a partner with the NZRB you don't say hang on guys before we sign we want the same deal as you pay to Australia and the UK but no nothing changes. Your on a panel reviewing leakage and you and your GM of Sports and Racing sign a deal which basically endorses off shore leakage. TABCORP must be thinking what an outfit NZRB is to allow this to happen.

A true story I once asked someone I knew who was a manager at the NZRB why Betfair don't pay anything back to the NZ Racing Industry when they take all the racing product that NZ generates and his reply was "because they don't have to"  With that mentality how can the NZ Racing Industry survive?. I replied "well its a bad look when your in a partnership operating with one way traffic like that".

John Allen is quoted as saying he was disappointed that the race field legislation was pulled well I am disappointed that he is helping to contribute to it with shocking management decisions such as the ones above.

Remember Paddy Power were profoundly opposed  to paying any fees to NZ Racing Industry and yet a person who was on a panel looking at the serious issue regarding revenue leakage happily signs a partnership agreement with a Company who isn't scared to let people know about what they think about paying any relevant product fees to the host company.   

John Allen as the CEO of an Industry that totally relies on income from betting revenue what were you thinking? Knowing the above if I was the owner or Chair person of a company where the above was allowed to happen I would sack you and your General Management for gross incompetence namely 'dysfunctional management of an organisation not acting in the best financial interests of the Industry it represents.

Everytime that you hear the NZRB saying how wonderful Paddy Power are as working partners just remember their statement "The AWC and its members (namely Paddy Power) are profoundly opposed to paying any fees to New Zealand racing.

You couldn't make it up as no one would believe you that's the sad part.

 

   

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On 2/3/2019 at 9:51 AM, LightsOut said:

Unfortunately once you read below you will realise that the only one having a laugh are the Paddy Power Shareholders at the expense of the NZ Racing Industry..

John Allen was on a panel over 18 months ago to look into how the NZ Racing Industry could combat overseas betting leakage on its product. He on behalf of his General Manager of Sports and Racing Glen Saville sold the proposal to the NZRB Board to have Paddy Power become partners with the NZRB over their co-mingling wagering partners TABCORP.  TABCORP pay race fees to the NZ Industry and rightly so NZ reciprocate the same back in fees to Australia. Why would you partner with a Company who doesn't pay your Industry (both racing and sporting codes) fees to take your product when that Company is going to be sharing between one other company (Openbet) annual income of costings to the NZ Racing Industry of $17 million dollars.

This link below was Paddy Powers stance on submissions to the Government over fees to be paid to the NZ Racing Industry (Sporstbet & Betfair are both  owned by Paddy Power). Extract from the link - Proposal 4: A consumption fee for offshore gambling operators accepting bets from New Zealand 7. 'The AWC and its members (namely Paddy Power) are profoundly opposed to this proposal.'

https://www.dia.govt.nz/diawebsite.nsf/Files/Racing-Act-consultation-submitters/$file/3-Australian-Wagering-Council.pdf

In 2016 Paddy Powers Betfair signed up with New Jersey Harness Racing to offer punters their exchange betting and increased their take out rate to Betfair customers to 12% from the usual 5% to provide income to the New Jeresy Racing Industry yet this Partnership subsidiary of Paddy Power continues to take from NZ Racing Industry and return nothing.

 Betfair charges its customers 2 to 5 percent of any winning bet. It does not charge a commission on losing bets. In Australia and the U.K., the company pays approximately 10 percent of its commissions back to the racing industries  https://classic.drf.com/news/betfair-funded-study-favors-exchange-betting  .  So why are they not paying the NZ Racing Industry the same return as what they pay to Australia and the UK, remembering this is part of a Company now in partnership with the NZRB. 

You have to ask yourself what any Company owner or Board would do if senior management had allowed the Company they are employed by to sign a partnership agreement that sees them screwed over for millions of dollars.  

John Allen on the panel to look at leakage and as the CEO of the NZRB the first thing you do is to stop Betfair taking live feed streaming of your product for their customers to bet on with no return to the NZ Racing Industry. You say if you want our live feed you pay for it. You don't do that and then the Company signs to be a partner with the NZRB you don't say hang on guys before we sign we want the same deal as you pay to Australia and the UK but no nothing changes. Your on a panel reviewing leakage and you and your GM of Sports and Racing sign a deal which basically endorses off shore leakage. TABCORP must be thinking what an outfit NZRB is to allow this to happen.

A true story I once asked someone I knew who was a manager at the NZRB why Betfair don't pay anything back to the NZ Racing Industry when they take all the racing product that NZ generates and his reply was "because they don't have to"  With that mentality how can the NZ Racing Industry survive?. I replied "well its a bad look when your in a partnership operating with one way traffic like that".

John Allen is quoted as saying he was disappointed that the race field legislation was pulled well I am disappointed that he is helping to contribute to it with shocking management decisions such as the ones above.

Remember Paddy Power were profoundly opposed  to paying any fees to NZ Racing Industry and yet a person who was on a panel looking at the serious issue regarding revenue leakage happily signs a partnership agreement with a Company who isn't scared to let people know about what they think about paying any relevant product fees to the host company.   

John Allen as the CEO of an Industry that totally relies on income from betting revenue what were you thinking? Knowing the above if I was the owner or Chair person of a company where the above was allowed to happen I would sack you and your General Management for gross incompetence namely 'dysfunctional management of an organisation not acting in the best financial interests of the Industry it represents.

Everytime that you hear the NZRB saying how wonderful Paddy Power are as working partners just remember their statement "The AWC and its members (namely Paddy Power) are profoundly opposed to paying any fees to New Zealand racing.

You couldn't make it up as no one would believe you that's the sad part.

 

   

I think that's basically CRAP.

From Betfair's own submission on the Racing Amendment Bill:

Betfair attempted to enter into a voluntary Product Fee and Integrity Agreement with New Zealand Thoroughbred Racing (NZTR), Harness Racing New Zealand (HRNZ) and Greyhound Racing New Zealand (GRNZ) in 2007. That is, Betfair would have voluntarily paid product fees and also provided access to integrity information to help NZTR, HRNZ and GRNZ maintain public confidence in New Zealand racing. Regrettably, the NZRB objected to the voluntary agreement being established which has meant the three racing codes lost the opportunity to collect voluntary Product Fees for the last 10 years and access valuable integrity tools.
 
And their first recommendation in that submission:
Recommended Changes:
a) Seek voluntary commitment from offshore wagering operators to enter into Information Use Charges and Integrity Agreements with major New Zealand racing and sports bodies

"

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Those are Betfair's current ideas as per the recommendation in their submission. I doubt that Paddy Power's position would be different. There is still a strong willingness to pay product fees. I think you are making up garbage. All corporate offshore bookies are the same if not already doing so. Betfair, for example, has a current agreement with the NZRFU and has been paying them product fees for some time. Racing is too dumb to do the same thing even though it amounts to peanuts.

 

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Have to agree to disagree with you Leggy the wording 'profoundly opposed' is pretty clear in english to me in what it means. Remind me how much Paddy Power's Australian bookmaking firm Sportsbet have paid in the past (purchased 2010) and currently in fees to the NZ Racing Industry on the NZ Racing  product they take for their customers to bet on.  

 

Quote

All corporate offshore bookies are the same if not already doing so.

I think your a little off the true situation with that quote. Australia Racing had to go to Court to get the Corporate bookmakers to pay them fees there wasn't much willingness for the bookmakers  to pay the fee prior to the favourable court decision for Australian Racing. 

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6 hours ago, LightsOut said:

Have to agree to disagree with you Leggy the wording 'profoundly opposed' is pretty clear in english to me in what it means. Remind me how much Paddy Power's Australian bookmaking firm Sportsbet have paid in the past (purchased 2010) and currently in fees to the NZ Racing Industry on the NZ Racing  product they take for their customers to bet on.  

 

I think your a little off the true situation with that quote. Australia Racing had to go to Court to get the Corporate bookmakers to pay them fees there wasn't much willingness for the bookmakers  to pay the fee prior to the favourable court decision for Australian Racing. 

Perhaps you would point me to where Paddy Power said they were "profoundly opposed" to paying product fees on NZ Racing. I thought you just made that up? I realise that Sportsbet, for example,did oppose it in the interests of NZ racing on the basis of the argument that if UK and US reciprocation occurs there will likely be a net loss to the NZRB from those fees. I think that is a fair argument against, don't you?

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14 hours ago, LightsOut said:

I think your a little off the true situation with that quote. Australia Racing had to go to Court to get the Corporate bookmakers to pay them fees there wasn't much willingness for the bookmakers  to pay the fee prior to the favourable court decision for Australian Racing. 

Not according to most of the corporates' submissions on the Racing Amendment Bill and the likes of Crownbet that already have voluntary product payment arrangements in place with the NZRB

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COMMENTS FROM THE AUSTRALIAN WAGERING COUNCIL 

The Australian Wagering Council (AWC) represents the interests in Australia of Sportsbet, William Hill, bet365, Unibet and Betfair. These comments on the proposals to amend the Racing Act 2003 reflect the views of these companies, all of which are licensed wagering operators in Australia. 2. AWC members both serve New Zealand customers, and consume New Zealand racing and sporting events to serve Australian customers.

4. The AWC is strongly opposed to the requirement to pay fees of any sort without being able to legally advertise – that is AWC members should not have the wagering equivalent of “taxation without representation”. They legally advertise betting of NZ Racing Product on their site. Betfair stream live NZ Racing on their site for their customers to bet on.

  Proposal 4: A consumption fee for offshore gambling operators accepting bets from New Zealand 7. The AWC and its members are profoundly opposed to this proposal. We note that the consultation paper says (‘Scope of the proposals’, p5) that the Review process set aside other options, including “removing the TAB’s statutory monopoly”. The AWC view is that the maintenance of the vertically integrated, statutory monopoly vitiates any case for a consumption fee of the sort proposed, because it has the effect of imposing a discriminatory tax on legitimate cross-border supply of services to New Zealand consumers.

12. Further, any such consumption fee should be contained to New Zealand residents betting on racing and sports events held in New Zealand only (no fee from Australians betting on NZ Racing Codes). Australians by law are not allowed to wager with the NZ TAB so in effect the Australian Wagering Council wishes to see no fees paid to the NZ Racing Industry from within Australia. So NZ can't collect any revenue from Australian punters wishing to bet with them and any that bet NZ product within Australia equates to no fees. Sort of defeats the purpose of trying to establish a fair return from overseas bookmakers betting on NZ Racing.

  Proposal    5:    A    ‘use    of    data’    fee for    offshore    gambling    operators    using    New    
Zealand    racing    and    sports    information
13. The AWC and its members are opposed to this fee, which is
again out of step with the approach of racing/sporting bodies
around the world. Although there are notable exceptions, it is
nonetheless unusual for a racing/sporting body to seek a data fee
on offshore operators in respect of bets taken offshore.

Enforcement 18. These unwelcome proposals are made worse by the approach described to tackle the inevitable challenges of collecting these proposed fees. 

Quote

Leggy - There is still a strong willingness to pay product fees. 

Strong willingness to pay product fees doesn't really mirror their written submission when they label the proposed fees  as unwelcome. So welcomed by the NZ Racing Industry but not by the above group.

Read their submission below. I have made up about as much as what they pay to the NZ Racing Industry. 

https://www.dia.govt.nz/diawebsite.nsf/Files/Racing-Act-consultation-submitters/%24file/3-Australian-Wagering-Council.pdf   

This $50 million dollar platform was sold to the Industry on the basis that it would pay for itself in 3 years and more income would be generated by the resulting competitive odds that the NZ racing Industry would be able to offer t compete with Australian bookmakers. If the Australian bookmakers are not paying some fee to the NZ Industry then it is impossible for the NZRB to be competitive due to what is paid to NZ Racing and the Sporting codes. The playing level is too far apart. You can give competitive odds but your overall profit will be the loser and the Industry can't afford to have that happen.

With Paddy Power its all one way traffic take out put nothing back eg one way traffic and the only road NZ racing is taking leads to a dead end.

Paddy Powers Australian Bookmaking Company pays 25% in product fees to Australian Racing and yet as a Partner in wagering with the NZRB they pay nothing. That money they don't pay goes into advertising to attract NZ customers.

https://www.punters.com.au/news/tax-earthquake-to-rock-racing-industry-_167078/

Betting companies Betfair and Sportsbet lose High Court challenge against race fees. https://www.news.com.au/finance/business/betting-companies-lose-race-fees-high-court-challenge/news-story/1e8a3fa7820180ce0f04871e52497963

Hard to see how you come to the conclusion Leggy that they were willing to pay. Paddy Power shareholders dividends are more important than the NZ Racing Industry.

As far as Crown Bet goes yes they pay a fee to the NZ Racing Industry but I don't think its as rosy as one would think and down the track you might find out exactly why.      

 

I will never get my head around why Paddy Power (reluctantly) pay racing fees to Australian Racing and not to NZ. 

 

 

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Well, in the interests of NZ racing, I am also profoundly opposed to the proposal as is the DIA and Winston which is why the amendment bill has now been scrapped.

I don't see what the ludicrous $50m betting platform has to do with it nor the equally ourageous claims that the cost would be recovered in 3 years. Never had a leg to stand on let alone 4. A complete waste of time and money up there with Typhoon at this stage.

It is certainly not impossible for the NZRB to be competitive. They are unwilling to try even though they have a monopoly. It's really too bad.

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Leggy so if your opposed to the proposal why do you think Australian Racing needs these fees to prop it up and the NZ Racing Industry doesn't. It's all very well to be opposed but the bottom line is the Industry needs other sources of income to survive. From having over 80% of the gambling dollar in the 80's the Industry now has under 20% with costs having risen greatly over that period until now. I don't think Winston has scrapped the bill but rather has said to the DIA to amend the legislation of the Bill as in its current state it wasn't going to be appropriate to be able to achieve it's desired purpose.  

You are 100% correct income verse costs makes it impossible to be able to be competitive. Deloittes report to NZTR said a $30 million expense of a Betting Paltform wasn't sustainable and they advised against it. The cost now is considerably larger than first envisaged and then you have the $17 million a year to pay to Paddy Power and Openbet for their services. The NZRB stated the Platform would pay for itself in 3 years time (not going to happen) that was for the build cost of it so where is the $51 million coming from to pay for 3 years of servicing it?

NZRB have a presence monopoly in NZ as  a wagering organisation but as we know agency's and outlets are getting reduced.and more NZ punters bet on the world wide web where there is no monopoly. Video killed the radio star and unfortunately the internet is killing the NZ Racing Industry. $100 million dollars of expense over three years and costs in all other areas not getting reduced, and income falling, you do the maths, its basically a script for a Steven King horror novel. What cost reductions have the NBZRB made to offset the Bet platform over run of costs and more concerning the drop in turnover?

Quote

They are unwilling to try even though they have a monopoly. It's really too bad.

You start by making your new betting partners pay for your  live racing feed and racefield fees just like your comingling partners do. 'Monopoly' how do you lose playing that game by selling your assets and loaning too much from the bank to pay debt with not enough of an income stream to warrant doing that. 

There is no easy answer or road to take but one thing you do is listen to qualified advice from a reputable accounting firm rather than claims made by people who are lacking in the area required to negate that advice. Listening to a Company selling themselves on what they they can do for you is often a concern as no Company downplays how great they are but rather they overplay and after a month its pretty obvious there was a lot of prior overplaying going on. 

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Now launched unlike Typhoon and Helix which never even made it through production.

Needs a lot of work to get it to where it needs to be.

 

At a initial cost of $50 million plus another $51 million to help administer pricing feed and service compared to the cost of Typhoon you would hope they finally had lift off it. Now launched doesn't mean it's going to deliver as promised. History has sadly seen a lot of launching failures with one of the greatest The Titanic which was sold to the public that it was unsinkable. It made it through production as well but it was obviously over sold by its builders to the Ships owners that it wouldn't sink. 

'Needs a lot of work to get it to where it needs to be' nothing a decent drop kick couldn't handle.

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On 2/4/2019 at 3:44 PM, LightsOut said:

Betfair were not owned by Paddy Power in 2007, they purchased the Company about 3 years ago. Betfair's ideas pre 3 years ago and Paddy Powers just recently on Product Fees are obviously miles apart. 

Betfair AU and Betfair UK have different owners or so I am told by their help desk.

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