Gambling's share of NRL revenue could well double. That brings power.
Malcolm Knox
Journalist, author and columnist for The Sydney Morning Herald.
May 15, 2020 — 11.37am
While many participants in Australian sport are looking at an austere future, one is sitting pretty.
Players, sent home for weeks, are returning to scrawny pay packets. Head office jobs are gone for good. The grassroots are being starved. All so-called inessential projects are being cut. Professional women’s leagues are being sabotaged and discarded as if they were luxury products. Broadcasters are downsizing their contributions, and make no mistake, while any deal will be celebrated as a triumph, they are not only on reduced terms, but they set a precedent for future downward renegotiation. Every dollar is being clawed back, even the cents spent on rugby league referees.
But one stakeholder is set up to do very nicely, thank you very much.
NRL aiming to speed up the game
According to data from credit bureau illion and analytics firm AlphaBeta, sampling the transactions of 250,000 Australians, our weekly spending on online gambling has gone up by 142 per cent during the coronavirus lockdown. Google Trends reports that the search term ‘online casino’ has received double its normal traffic. While sports betting and physical poker machines have gone into abeyance, the shift to online punting has taken root, with a steady increase of one-third, and millions of new accounts being opened. The share price of Tabcorp, Australia’s biggest gambling company, is up 10 per cent since 24 April – a pity, perhaps, for Sportsbet punters who have been banned from wagering on the stockmarket index. Men, of course, are spending seven times more on online gambling than women. If you thought gambling companies saturated your favourite sports already, wait until you see what they’ve got planned for the restart.
Sporting bodies are coy about how much they earn from gambling. The National Rugby League bundles ‘Sponsorship and Wagering’ into one revenue item. The Australian Football League buries it in its $290 million-a-year revenue from commercial operations. Cricket Australia’s annual reports are fairly detailed on expenditure but opaque on revenue, folding almost its entire income into a line item titled ‘Revenue from continuing operations’. Little wonder that players’ unions are so unhappy about the scarce provision of financial detail.
Another reason for this coyness has been that the people who run sports tend to hold their nose with one hand while holding the other out, behind their backs, to collect their gambling receipts. There is not a lot of pride from cricket and football about their partnerships with betting companies. There are billboards aplenty, and the advertising is impossible to avoid, but the administrators’ public spin draws our attention to how they are working so hard to protect children from seeing all those ads, to limit the spread of exotic betting products and sinister data-gathering, and to counter the corruption that gambling brings into sport as surely as night follows day.
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Bryce Cartwright's Gold Coast Titans are sponsored by bookmaker Neds, one of several tie-ins the NRL has with the gambling industry.
But this prim hypocrisy is the behaviour of times of plenty. Big sports can make out like they don’t have a gambling addiction when their dependency is diluted by other sources of income. When money is rolling in from TV stations, corporate sponsors and fans buying tickets and merchandise, the sports are in a strong enough position to moderate the ambitions and the intrusiveness of their gambling partners.
So what happens when all that other income dries up, while the betting companies are still standing tall?
Take the NRL as an example. Last year its ‘wagering and sponsorship’ revenue accounted for $84 million, not a large chunk of the $556 million the NRL earned, but still the second-biggest item behind broadcast rights. Now let’s look into the future. Last year’s $55 million in game-day receipts can be just about written off this year. The $348 million in cash and contra provided by broadcasters could drop, according to reports, by more than $100 million depending on the outcome of negotiations between the league, Nine and Fox Sports.
Digital revenue ($24 million) and merchandise royalties ($12 million) are wet finger in the wind stuff; the question is not whether they will be down, only how far. When the game’s total revenue falls below $400 million, that gambling money begins to look more and more juicy, and the gambling companies become louder and more influential voices. (League’s $84 million, by the way, does not include direct sponsorships of clubs and facilities by betting companies. Sportsbet has been showering NRL clubs with payments, as the ABC’s 7.30 program recently revealed, and we are so used to stadiums carrying the bastard names of betting products most of us have stopped noticing.)
Gambling revenue contributed approximately one-eighth of the dollars going into the overall rugby league industry last year. This year and next, its relative contribution might approach one-quarter. That brings power.
Illustration: Simon Letch
So in walks Peter V’landys, who has already moved the game’s centre of gravity from management to board, from everywhere, in short, to himself. His effectiveness is beyond question. He can, and will, deserve credit for wrestling league back onto the field ahead of everyone else. He might
end up wearing yellow and doing the refereeing while he’s at it. As the chief executive of Racing NSW, he is also, axiomatically, a friend to the gambling industry. Racing is a vehicle for punting. The betting industry sees all sports in those terms.
How do we think Chairman Pete will respond to the coming outcry about the surge in gambling promotion in rugby league? What about the collection of analytics and other private information about NRL digital subscribers? Is every community development officer, every grassroots grant, every referee, every women’s club, every hearts-and-minds project, every one of those threatened ventures outside of rugby league’s core business going to be held hostage to ‘the greater good’ of maximising revenue? And if governments try to step in to control the excesses of gambling in rugby league, and they are up against Peter V’landys and Sportsbet, who do you think is going to win that argument? Wanna bet? (Hint: we already know, so the markets are closed.)
Australians piss away – sorry, enjoy the thrill of losing - $24 billion a year on gambling. Online punting only accounts for 5 per cent of this, though its proportion has shot up during the pandemic, even in sports betting, where companies have offered odds on esports and horse racing, which have been able to carry on through the lockdown. When league and other sports get going again, prepare for a celebratory orgy of betting and betting advertising.
I’m not a gambler myself, but if I had to take a punt on which way sports will turn when they come under pressure from their wagering partners, the most prosperous of all their corporate mates, I know who I’d have my money on.
