Why should bookies be made to share their profit with sports rights holders? Many industries exist because of another without paying profit share, and we actually help sport to fight corruption.
By Mark Davies, managing director of BetFair
This week, the Sports Rights Owners Coalition lobbied the sports minister, Gerry Sutcliffe, for a fee from betting companies. Betting exists, they said, because of sport, so betting companies ought to pay a share of their profit. Meanwhile, betting facilitates corruption; so the fee should cover the clear-up cost.
It is hard to see on what basis the group can claim an “intellectual property” argument when betting companies use no logos or images; nothing, in fact, that is not in the public domain (place names, presumably, are the “property” of the places themselves. Or do Chelsea and Liverpool pay rights fees?). But even assuming the SROC has a reason to exist, do its two arguments stand up to scrutiny?
Many industries exist because of another without paying profit-share. The retail fuel industry is almost entirely dependent on people driving cars, but BP pays nothing to Volkswagen; were it to do so, it might fairly claim that it should receive a rebate for its investment in garage forecourts.
Similarly, the pubs near football grounds do a roaring trade on afternoons when there’s a home match. Should landlords give away some of the takings?
Newspapers often produce a supplement for big sporting events like the Cup final. It increases circulation. Should a share go to the Football Association?
And lobbyists, of course, exist purely because of politicians. Perhaps the sports minister should take a cut from the people who represent SROC? [LAUGHTER.]
To argue that “you make money on football, so football should have a share” ignores the fact that once you start to be prescriptive, you need to be properly so. On the whole, it’s not football, it’s the Premier League; or predominantly the big clubs in the Premier League. In reality, a tax on betting companies will become a tax on punters, who ultimately pay for the added costs, to add an extra £5,000 a week to a major footballer’s salary. Where’s the justice in that?
If sport wants to get into betting, it can apply for a licence like anyone else, and pay the costs inherent in running the business: hundreds of millions on technology, risk management, infrastructure, and brand. Or, sport by sport or team by team, it can sign commercial deals. Betfair are Manchester United’s official betting partner; and the sponsor of the King George at Ascot, among other things. Both deals run to seven figures.
SROC’s second basis of claim for money is the principle of “polluter pays”: they claim that betting companies create an integrity problem which sports have to deal with. Bluntly, this is nothing more than a Trojan horse to riches, recommended by lobbyists who can’t stand up the argument about intellectual property.
Inherent in sport’s clear-cut results is the ability to profit in some manner, which leads the unscrupulous to try anything – as was already apparent through years of scandal unconnected to, and pre-dating, the internet betting industry. This month of all months, it has never been easier to demonstrate: sport is reeling from two of the biggest cheating scandals in history, neither of which had anything to do with betting: the Harlequins Bloodgate scandal, and l’affaire Renault both demonstrate what many have always known: you can only corrupt sport if you’re involved in the event.
So the question “should sports have an integrity-management function of some sort?” is and always has been yes, whether the legal betting industry exists or not. The fact sports are only just waking up to that, and have not budgeted for it in the past, does not mean someone else should have to pay for it just because they point it out. Television cameras brought Bloodgate to light, but many in rugby will tell you they suspect it had happened before. Should Sky now pay for the RFU’s integrity team?
Lawrence Donegan accused me of being like a graffiti artist who isn’t prepared to pay to clean up the walls of a building I’ve defaced. What Betfair has done is provide audit trails, and a 40-strong team which analyses them, at a cost to us of millions of pounds a year. We share information with sport on a real-time basis, free of charge, through our groundbreaking Bet Monitor. Far from not wanting to help, we’ve pointed out that the building has been defaced for years without them noticing, and we’ve provided the paint stripper to do the job. On what basis should we now pay for the workmen as well?
[Mark Davies is the managing director of the online betting exchange, BetFair.]
If there was no horse racing and no football – bookies would find it difficult to exist. The pub that attracts a football crowd, continues to trade when the football season is out; the relationship is not the same.
Bookmakers are akin to leaches; they suck these sports dry, and then they spit them out. At the very least it is only fair that they are forced to obtain a licence from the sports governing body, before they are allowed to offer bets on the sport.
Moreover, there is also the fact that the pub exists independently from the sport; it just so happens that it has been built in a good strategic position. Bookmakers facilitate corruption, which is why, after all, Betfair spends so much money on its security team. A US Court found Napster guilty of facilitating copyright abuse and it was fined heavily and forced to shut down.
The precedent was set for a bookmaking company to be taken to court for facilitating corruption in court. A licencing system would eradicate the need for such action; in that both parties would be aware of the risks at hand.