The sports betting segment has grown at the expense of on-course totalisators at horseraces
Melbourne, Australia (PRWEB) November 08, 2014
The Horse and Sports Betting industry has undergone significant change over the past five years. According to IBISWorld industry analyst Spencer Little, “private betting websites have gained a greater foothold in the market due to changing consumer preferences and the improved accessibility of betting websites.” Increasing horse racing attendances, household internet connections and spectator sport participation have also contributed to the industry's positive performance. As a result, revenue is estimated to increase at a compound annual rate of 2.0% over the five years through 2014-15. Demand for other gambling activities has slightly restricted revenue growth, as other activities such as casino games and electronic gaming machines have been competing for gamblers' discretionary dollar.
In 2014-15, industry revenue is estimated to rise by a slightly more subdued 1.3%, to reach $3.6 billion. Although sports betting is still a small product segment, it is the fastest growing segment in the industry. This segment allows bettors to place wagers on sporting events using websites, smartphone applications or traditional totalisator methods. “This segment has grown at the expense of on-course totalisators at horse races,” says Little. Consolidation has also occurred over the past five years, as several larger companies have increased revenue and market share concentration through the acquisition of smaller betting firms. The industry is expected to continue to grow over the next five years, despite facing a few challenges. Traditional TAB outlets are likely to struggle significantly due to the popularity, accessibility and user-friendliness of online and smartphone betting services. Revenue generated from wagers placed on horse and harness races is also expected to continue to decline as betting on sporting matches continues to gain a foothold and is heavily promoted. The industry is projected to continue to attract international attention, as major betting companies from Europe look to take advantage of Australia's growing betting market.
The Horse and Sports Betting industry exhibits a high level of market share concentration. The high level of merger and acquisition activity from the public float and sale of former state-owned TAB operations contributes to the industry's high market share concentration. In addition, companies with TAB outlets effectively operate in regional monopolies, which provide the opportunity for firms to collect revenue from an entire state's wagering activities. Concentration is significantly lower for bookmakers, as these businesses are often small-scale enterprises. Over the past five years, market share concentration has remained fairly stable, as online providers have grown at the expense of the industry's well-established TAB outlet operators.
For more information, visit IBISWorld’s Horse and Sports Betting industry in Australia report page.
Companies in the industry primarily operate gambling services, including totalisator and betting services. Wagers are generally placed on horseraces and sports matches. The industry includes online gambling services but excludes casino and lottery operations.
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