Tellytrack fee showdown

HE “Tellytrack vs Bookmakers” war reaches its zenith today when a court case takes place regarding the new Tellytrack fee structure.

Tellytrack is demanding that effective from October 1, 2013 bookmakers pay 3% of their turnover for the use of the Tellytrack television feed instead of the fixed amount of R5,600 that had been in place for the past 14 years.

Tellytrack is owned by the three

Toperators of South African racing, with Phumelela having a 61% share, Gold Circle 24,96% and Kenilworth Racing 14,04%. Tellytrack has argued that bookmakers do not contribute enough to the upkeep of racing.

Turnover

The combined betting turnover of bookmakers in South Africa is roundabout the same as the national Tote, which is owned by the operators.

However, in an economic impact study done in 2009 it was revealed that bookmakers contribute only about 14% to the funding of the sport

This means that the operators are left to pay about 86% of the required amount.

Tellytrack will argue that the use of their intellectual property should cost the bookmakers more in order to level these playing fields and will point out that the fixed fee that was in place constituted only 2% of the total cost of funding horseracing.

The new fee structure will mean the bookmakers’ costs for the use of the Tellytrack feed will increase on average to just over R69,000.

The bigger bookmakers will be the worst affected, considering the fee is based on a percentage of turnover.

Argue

In the court case the bookmakers will argue that it would not be commercially viable for them to sign the new subscription contract with Tellytrack.

Members of the KZN Bookmakers Society will not be part of the court case, with the exception of Hollywood.

The KZN Bookmakers Society is in negotiations with the CEO of Gold Circle Michel Nairac in the hope of finding a solution. Gold Circle’s strategy regarding the location of their off course Totes includes a recognition that a Bookmaker and a Tote operating on the same premises or next door to each other leads to a mutually beneficial increase in turnover for both parties.

Nairac is therefore concerned that the loss of the “racing picture” in the bookmaker outlets will affect Tote turnover in the province.

The outcome of today’s court case will be awaited with acute interest by all players in South African racing.