Future at stake for lords of the ring
Sunday January 15 2012
On-course layers are feeling the strain in racing's changing climate, as Ronan Groome discovers
WE'RE at Fairyhouse on Wednesday and Francis Hyland, the on-course bookmakers' representative for HRI, is in pensive mood. "I'm in dire danger of being both a dodo, and a Siberian tiger," he says. Naturally, he is asked to explain.
"Well, I was on the floor of the
London Stock Exchange in the 1970s and they're all up in offices now. Today I'm standing here in a line at the racecourse, a line that's getting shorter and shorter."
Midweek racing is like
Ireland playing friendly matches in the
Aviva Stadium. The sporting action on show is necessary, but there is only just about enough of an audience there to make it worthwhile.
To the naked eye, you suspect the crowd falls into the 'not that bad' category. It's midweek, the racing isn't exactly top-class, the weather is gloomy and it's not long after Christmas. But it's not the number of people going racing that's the problem, it's the type of people who are attending, a totally different clientele, Hyland explains.
We're nearing the 1.30, the third race on the card, and we're down at Hyland's pitch, situated towards the winning post side of the ring, away from the main body of bookmakers. "That's the problem, the line gets smaller and smaller, and where once there were bookmakers all around you and you were in the body of action, now you are nearing the end of the line away from it all."
One man strolls down this side of the racecourse, close enough to see Hyland's odds. He observes the prices, before walking up to the pitch. "Can I have a tenner on number 10 please," he says, "No problem, sir."
That's the only bet Hyland takes on the third race.
Let's be honest about the sport. Very few people watch racing without having a bet. In fact, they watch racing in order to bet. There are very few racing fans, so to speak. There are people who claim to be racing fans, but that's really only because they bet.
Racing isn't a sport you can get involved in. It's not like rugby or soccer, it's not like football or hurling. If you watch racing on the television or read about it in the paper, you're most likely looking for a betting angle and traditionally people go racing for a bet.
"Punters don't come to the races to bet anymore, there is no incentive for that. The punter who comes to the races these days is coming not to bet but for more of a social factor," says Hyland.
The trend is clear to see when looking back at some of the figures from last year.
Midweek racing and festival meetings are a different kettle of fish but it was interesting that at the Galway festival last year, where the drop in attendance was minimal, betting turnover still dropped by a further 11 per cent.
With technology these days, you can get on the internet just about anywhere so what's to stop anyone betting away on their phone at the races? It's a bit like doing your drinking at home before hitting the nightclub, or in this case you can just go to the races and make a bet on your phone. Any way you look at it,
the heavy drinkers aren't showing up for the gig and the rest may as well be sober.
The problem for Hyland started when betting exchanges made progress at the beginning of the last decade. It was interesting that at the time, himself and fellow on-course bookmakers Brian Graham and Justin Carthy featured in the Irish Racing Yearbook of 2003 talking about the state of betting on course.
The main problem at the time was the chalk boards. It was up to HRI to encourage or provide all bookmakers on course to have an electronic board, because the betting ring, as vibrant as it was, deserved a better standard.
There was also another article on
Betfair. The exchange was in its infancy at that stage so the piece was basically to explain how it worked. In the same annual this year, Sean Graham is talking about the possibility of extinction, Betfair the main cause. Francis Hyland shudders at the sound of the word when I mention it. Not 'extinction', but Betfair.
"I don't like it (Betfair), I don't agree with it, I don't think it's fair."
The attraction to just stay at home, with competitive prices, guaranteed prices, and watch racing entirely free on your laptop is one side of the coin, but the main issue is the effect that Betfair has on the ring itself.
We're standing in the middle of the ring now and Hyland points to one bookmaker. "You see him there? You see the way he has 11/4 about Killiney Castle and everyone else is 9/4? That's the problem. He's laying the horse at 11/4 and backing him on the machine at 3/1. Don't ask me how he's making a profit out of it because I've no idea. I don't know how any bookmaker can make a profit out of using Betfair."
This, he says, is the core problem. A bookmaker's ring is dependent on the SP, and now that the majority of bookmakers at the races operate on Betfair, the money that used to revolve around the ring, the money bookmakers used to lay off bets amongst themselves, is seeping out. The market is no longer liquid.
With the SP driven up as a result, the margins on each book are smaller than they used to be. During the Killiney Castle race, Hyland directs my attention to the metal rails behind us. "About ten years ago maybe, that rail would have been full of bookmakers," he says. "Now look to your right, there are just two bookmakers. I'm closer and closer again to being the last man in the line and that means no business."
How do you solve the problem? Desperate times call for desperate measures and that's exactly how the strategic marketing group for HRI have approached the situation.
Their answer is Betfair on the racecourse. Online betting available everywhere.
Wi-Fi hotspots and internet lounges. They also plan to allow home betting in the course bookmaker shops.
The strategic group admits that this is one of their most challenging assignments. The train of thought is that on-course bookmakers will
benefit more if punters are attracted back to the racecourse than if they weren't there at all.
But even if the plan did break the mould and bring the betting customer back, surely that customer would be only coming back for the use of the modern-day betting structure?
The on-course bookmaker is still just as likely to be left outside in the cold. It would be an all-or-nothing move really.
In any case, Francis Hyland sees it as a dangerous move to tie up to betting exchanges for the long-term future.
"I can see that it sounds attractive and initially it could bring people back racing, but it could be extremely dangerous for racing to commit to the exchanges long term. Who is going to make the market? The margins on Betfair are so tight that once people realise that they can't make money, what will be the point of carrying on? They're planning on taxing the whole thing as well, so that will be even more of a burden on the margins."
A vibrant betting ring is an integral part of the Irish racing scene. Take away the betting ring -- as we saw at Leopardstown during the bookmakers' strike in 1995 -- and you take away a significant element of the tapestry that makes the Irish racing experience what it is.
Survival is the objective for all.
