Changes afoot: a look at the Australian wagering landscape

Cover image courtesy of The Image Is Everything

Wagering in Australia is set to look vastly different over the coming years, after a parliamentary inquiry into online gambling handed down 31 wide-ranging recommendations at the end of last month.

The House of Representatives Standing Committee on Social Policy and Legal Affairs tabled a report, titled ‘You win some, you lose more’, into online gambling and its impacts on problem gamblers. Chair of the Committee, Peta Murphy MP, said: “Australians are the biggest losers in the world when it comes to gambling. We have a culture where sport and gambling are intrinsically linked. These behaviours are causing increasingly widespread and serious harm to individuals, families, and communities.”

Murphy added: “Gambling advertising and simulated gambling through video games, is grooming children and young people to gamble and encourages riskier behaviour. The torrent of advertising is inescapable. It is manipulating an impressionable and vulnerable audience to gamble online.

“A phased, comprehensive ban on online gambling advertising is recommended within three years. This will give major sports and broadcasters time to find alternative advertisers and sponsors, while preventing another generation from experiencing escalating gambling harm.”

Phase one of the proposed ban involves stopping all online gambling inducements and inducement advertising, and all advertising of online gambling on social media and online platforms such as Instagram and YouTube, as well as the ban of advertising online gambling on commercial radio between 8.30-9am and 3.30-4pm (school drop off and pick up).

The report recommends the appointment of a federal minister dedicated to reducing online gambling harm, the creation of a national regulator and changes to behavioural algorithms in gambling apps and comes at a time when Australian Prime Minister Anthony Albanese described advertising of online gambling during live sport as “reprehensible”.

The proposed blanket advertising ban of online gambling advertising would be applicable to all media outlets except for dedicated racing channels. Responsible Wagering Australia (RWA), which is the independent peak body for Australian‑licensed wagering service providers (WSPs) and represents bookmakers such as Sportsbet, Betfair, Entain’s Ladbrokes and Neds, Bet365, as well as PointsBet, believes this to be an overreaction and is concerned about the impact a blanket ban will have at various levels.

“Responsible Wagering Australia members, along with broadcasters and major sporting codes have publicly acknowledged that there is a growing desire in the community to see less gambling advertising, however, implementing blanket bans would be an extreme overreach that would rip hundreds of millions of dollars out of broadcasters and sports – money that flows into regional broadcasting, sport integrity programs, keeping sport cheap and free to participate in and keeping sport and Australian content on free-to-air TV,” Responsible Wagering Australia CEO, Kai Cantwell, told TTR AusNZ.

“Strict changes like advertising bans and bans on inducements, such as bonus bets, have shown to be ineffective in addressing problem gambling, with Australians instead turning to illegal offshore markets to seek out these offers – markets which lack consumer protections and result in billions of dollars being lost from the Australian economy.”

In partnership with the Australian Government, RWA is keen to find a ‘happy medium’.

“RWA looks forward to engaging with the Government to develop sensible and measured reform across all advertising platforms, such as capping the number of ads that are shown, while also building on our world leading consumer protections,” Cantwell said.

Bigger problems

Long-time bookmaker Robbie Waterhouse is of the opinion the blanket advertising ban isn’t too much of an issue, and certainly not the major concern for corporate wagering companies.

“I expect the big operators aren’t too concerned about it (the ban) because they already have the customers. Each of the major operators actually have a breathtaking number of customers,” Waterhouse said when speaking to TTR AusNZ.

“I don’t see it as a major catastrophe.”

Waterhouse believes the Point of Consumption Tax (POCT) is the bigger issue. The Point of Consumption Tax is a tax that state governments in South Australia, Victoria, New South Wales, Queensland and Western Australia have introduced to generate revenue from online betting. “Point of Consumption” means the tax is payable where the bet was placed, so, for example, a bet placed in Victoria generates revenue for the Victorian Government.

In May this year, the Victorian Government announced it will introduce legislation to increase the POCT on wagering by Victorian residents from 10 per cent to 15 per cent of net wagering revenue from July 1, 2024, bringing the state into line with the rates that already apply to wagering and betting activity in New South Wales, Western Australia, South Australia and Tasmania (Queensland’s rate is 20 per cent).

Waterhouse commented: “Higher taxes is a big problem. The taxes are absolutely huge, and of course they’re all passed onto the punter, it’s not the bookmaker paying it, it’s the punter paying it.

“The Victorian taxes are absurd. If you win $x on the first day of the Melbourne Cup Carnival, then lose $x on the second day, then win $x on the third day and lose $x on the fourth day and you’ve broken square, you lose a fortune in taxes.

“On the winning days they charge you a large percentage of your wins and on the losing days they charge you a turnover tax.

“It’s absurd.”

The ‘You win some, you lose more’ report follows new gambling advertising taglines that were introduced by the commonwealth, states and territory governments under the National Consumer Protection Framework. From March this year, online wagering companies were required to ditch the ‘gamble responsibly’ phrase with a series of seven harsher warnings, such as ‘chances are you’re about to lose’, ‘What’s gambling really costing you?’ and ‘imagine what you could be buying instead’.

This stronger messaging is more of an annoyance to the punter than anything else, according to Waterhouse.

“I don’t think (they will have an impact). Punters just find it annoying rather than it stopping them betting. They’re being treated like children,” he said.

Racing’s response

Thankfully, for the racing industry, dedicated racing channels, such as Sky Channel and Racing.com, as well as physical betting shop premises, are exempt from the proposed advertising bans. Had that not been the case, the ramifications would have been crushing, with the industry unable to monetise the ace in its hand - content.

Following the release of the report, TTR AusNZ contacted some of the Principal Racing Authorities (PRAs) to get their thoughts on how these recommendations may impact them.

Given wagering turnover is the main source of revenue for the racing industry, and it provides income to thousands of participants in a range of roles right throughout the country, a direct impact on turnover could have huge ramifications.

Most of the PRAs that TTR AusNZ reached out to declined to comment, with the general consensus being they need more time to digest the detail of the report. For example, Racing Victoria (RV) said: “We are still working through the report and considering the outcomes before making any comment.”

Wagering Service Providers’ response

Unsurprisingly, Sportsbet’s chief executive, Barni Evans, echoed the sentiments of RWA.

“We believe an approach that significantly reduces the number of ads rather than complete bans would respond to community concerns, while still supporting sport and media,” Evans remarked.

It's a different story at Tabcorp, however, with their chief executive, Adam Rytenskild, claiming the inquiry is an “important moment for the sustainability of our industry”.

Importantly, Tabcorp is not a member of RWA.

“Tabcorp welcomes the committee’s recommendation for a nationally consistent regulatory framework. All wagering operators should have to adhere to the same regulations,” Rytenskild said.

Tabcorp’s stance is understood to be motivated by an eagerness to protect its significant market share. Tabcorp is targeting a 30 per cent market share of Australia’s online betting industry by 2025 after group revenue rose 10.8 per cent in the first half of its 2023 financial year.

“I suspect the advertising ban is brought about by the TAB,” Waterhouse said.

A punters’ response

Someone that is well-equipped to comment on this issue is Richard Irvine - a prominent punter and a staunch campaigner for the rights of punters.

Irvine told TTR AusNZ he is a bit miffed at the lack of industry response to this point.

“It was quite incredible how hard the Government went, how sweeping they are in their suggestions of reform,” said Irvine.

“I’m surprised at the lack of response from the wagering operators and also the regulators. I think it calls for a bit of a coalition. What I’m surprised isn’t happening is that regulators, bookies and also punters, and that’s across the three codes (gallops, greyhounds and harness), aren’t coming together and going to the Government and saying, ‘We realise we’ve probably pushed things too far and we can run a sustainable and conscionable industry’. That doesn’t seem to be happening.

“You can see the writing on the wall, so what’s the industry going to do about it?”

More hopeful than confident, Irvine said this report could be a “catalyst” for change, where - in the absence of a high-functioning national governing body - the PRAs work collaboratively, rather than in silo.

“This might just be the catalyst where it does do that,” he said.

Irvine believes these reforms will have a greater impact on sport than racing, and that is one reason the racing industry has been relatively quiet on the matter.

“I also kind of think that possibly the reason Racing NSW or Racing Victoria might be okay with it all is that they’re cracking down really hard on the sports advertising stuff - advertising during cricket, NRL and that, so that could possibly be better for racing. The casual punter might get reinvigorated with racing,” Irvine said.

Recommendation 25 in the report states, ‘The Committee recommends the Australian Government consult with industry and people who gamble to determine minimum bet limits for online wagering for inclusion in national regulation’. Irvine, who was instrumental in getting the Minimum Bet Laws introduced in 2013, said this recommendation is much-needed.

“I’m a big proponent of the minimum bet limit, I think that that’s brilliant, it’s what punters need and deserve. There’s a bit of water to go under the bridge in the sense that we have to get in there and let the Government know what our lived experience is, for us to get a fair minimum bet limit,” Irvine explained.

Irvine said it will be interesting to see how the Government tackles the process from here.

“I guess the next step is, ‘What’s the Government actually going to do?’, because they’re recommendations at this stage,” he commented.

“One of the other major things is no more affiliates, that’s pretty big.

“They’re really trying to cool the industry down.”

Regarding a national regulator, Irvine said: “It’s fantastic, it’s hopeless at the moment, hopeless.”