Industry revenue is expected to grow an average 1.8% per year over the five years through 2011-12 to reach $23.9 billion
Melbourne, Victoria (PRWEB) October 25, 2011
Over the next five years, horse and dog betting will experience low growth in Australia, while sports and events-based betting will continue to excite punters' interest and wagering to record robust growth. According to IBISWorld, the nation’s largest publisher of industry research, over the five years through 2016-17, it is expected that many niche wagering products will be developed to attract newer, more frequent and higher-spending clients. With online operators providing odds on events such as elections, there is vast opportunity for new markets. This will be assisted by robust growth associated with the transfer of betting online. However, competition from casinos for a share of overall household gambling revenue will intensify, as they also face a low revenue growth.
The Horse and Sports Betting industry in Australia is undergoing significant change, as governments abandon their holdings in state-based TAB operations to effectively develop a national wagering market, according to IBIS World, the nation’s largest publisher of industry research. Private betting websites are also gaining a greater foothold in the market, due to changing consumer demand and preferences, and improved access to betting websites. This is particularly relevant to the Northern Territory, which provides favourable legislation and has attracted many large domestic online betting operations. Sports and events betting, while still low in revenue terms compared with racing, is now the fastest-growing segment in the industry. The segment provides sports and events fans and professional punters the opportunity to wager on a wide range of sports and events, which has opened up a new market for these providers.
According to IBISWorld analyst Ian MacGowan, Industry revenue in the Horse and Sports Betting industry is expected to grow an average 1.8% per year over the five years through 2011-12 to reach $23.9 billion – up 3.4% on the previous year. “Sports betting in particular is growing robustly, and this is expected to continue over the next five years, particularly among online businesses, says MacGowan. “As a result, industry revenue is expected to increase 3.1% per year to reach $28.8 billion in 2016-17.”
After months on the sidelines, racing returned to normal, and by March 2008 Australia was declared EI-free. Consequently, the industry began to recover. Although this remains the case, the industry will still feel the effects of EI, with tighter government restrictions resulting in fewer quality horses entering Australia, thus affecting betting revenue and attendance figures. Growth has also been constrained by the economic slowdown of 2008-09, which resulted in tighter spending patterns by Australian consumers. Racing is still some way from returning to pre-EI revenue levels, and industry revenue is not expected to surpass $2.0 billion over the next five years.
Compounding the industry's woes is the fierce debate regarding the fate of jumps racing. Steeplechase horses have a high rate of injury (at which point many are put down) and there is a strong moral push against it. In 2009, the Victorian Racing Club (VRC) came close to ending jumps racing in Victoria permanently. Although this did not occur, jumps racing still faces an uncertain future, and its demise would threaten about 3.0% of industry revenue.
According to IBISWorld analyst Ian MacGowan, the Horse and Sports betting industry is likely to experience consolidation of enterprise numbers over the next several years, brought about by mergers such as the one between the Australian Jockey Club and the Sydney Turf Club. “This will help to lift profitability for the remaining operators, says MacGowan. “Industry revenue is forecast to rise by 4.7% in 2011-12 to reach $1.91 billion. Over the next five years, revenue is expected to increase by 1.7% per annum to total $1.98 billion by 2015-16.”
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