The New Zealand TAB has signed a 25-year strategic partnership with Entain to run its operations with the deal approved by Racing Minister Kieran McAnulty on Tuesday.
So what does it mean for racing, sport, punters and the future of gambling in this country?
Herald racing editor Michael Guerin answers the big questions in a deal which would ultimately have a $1 billion footprint.
1. Who are Entain?
Entain is a UK-based betting operator (bookmaker) whose major brands include Ladbrokes and the growing Australian brand Neds.
The operation of the New Zealand TAB business will come mainly under Entain’s Australian business.
2. What will they do for the NZ TAB?
Almost everything. They will oversee the operation of betting on racing and sports, promotion, finance, broadcasting and every other day-to-day element of the business, although the TAB brand will remain.
The TAB will still have a board who have statutory obligations and will still be responsible for distributing the TAB profits to the racing codes and sporting organisations.
4. How can Entain help?
The TAB has struggled to retain New Zealand punters as larger overseas bookmakers have more money and scale as well as the resources to offer incentives to the country’s biggest punters.
Entain will have the technology, skilled staff and scale to fight for Kiwi punters on a more level playing field.
They also have the money to invest in the promotion of NZ racing, which is losing a battle for the hearts of NZ punters, many of whom are now betting more on Australian racing.
Entain are also likely to boost the broadcasting of NZ racing which was decimated during Covid cost-cutting and has struggled to retain audiences since.
5. How much money will the TAB get?
The TAB will get $150 million of extra guaranteed money over the next five years but after retaining some for reserves the majority will be paid to out NZ racing codes and sporting organisations, as well as $5 million going to stem problem gambling.
Entain has also guaranteed annual distribution to rise to $200 million in five years after it got as low as $125 million this year.
6. So who gets what?
Of the money that will be distributed, on top of what the TAB normally pays out to sport and racing, the racing codes will get at least another $100 million over five years and sporting organisations $15 million over three years.
Because it will be based in part on market share of what punters bet, the biggest winners will be thoroughbred racing and sporting codes like basketball, football and rugby league.
7. How will it change betting for most punters?
Not at all. The TAB brand will be retained at least for now, so the betting experience whether it be via the TAB website, app, in a TAB agency or Pub TAB, won’t be greatly different.
There may be better offers, promotions and possibly more sports to bet on.
8. What about winning punters?
Overseas bookmakers can be notorious for restricting punters who win consistently, as the NZ TAB did too before they introduced their “Punters Promise” rule, which means any punter can bet to win at least $2000 on a horse or dog race.
It is believed that limit will remain under the TAB/Entain deal, with Racing Minister McAnulty making that clear to the new business.
9. Will the TAB/Entain eventually have a monopoly?
Very likely. The Government has announced its support for geo-blocking to stop NZ punters betting with off-shore bookies because they return so much less to New Zealand racing and sport.
While that sounds restrictive, it is actually the case in many countries but in New Zealand’s case, it would bring about a monopoly as we wouldn’t have the range of bookmakers to choose from as Australian punters do.
But geo-blocking will require legislative change so therefore needs a long, public and parliamentary process, and therefore almost certainly can’t happen until at least next year.
10. What are the benefits of geo-blocking?
Most immediately it would trigger an estimated additional $100 million payment by Entain to the TAB, with most of that money going back to racing industry and sporting codes.
In the longer team it would negate the threat from overseas bookmakers and mean that a percentage of every dollar bet by NZ punters would go back to sport, racing and the fight against problem gambling in New Zealand.
11. What is the downside of the deal for NZ punters?
At the moment none, it will be gamble as usual (responsibly, of course) with a few more bells and whistles added.
If geo-blocking does come in that will mean less choice as punters will only be able to bet on one market and not shop around for a better price.
12. What will it means for racing fans?
Entain have a proven track record as a sponsor and promoter of major racing carnivals and have pledged an amount around $10 million to help build new carnivals here or more likely boost the current major race days.
In short, racing’s summer is about to get bigger.