British bookmakers are on track to make a record contribution to horse racing next year, with the media rights bill expected to rise by almost £30 million.
The five largest Betting and Gaming Council members for horse racing betting, Entain, Flutter, bet365, 888/William Hill and Betfred, expect to see record increases in the costs of broadcasting races.
In 2022, BGC members paid £270,1 million for the rights to broadcast races live for customers and show them in bookmakers.
But it is expected that the cost will rise to £285,3m this year, up 5,6%, with members estimating a further increase to £315,2 million in 2024, a further increase of 10,5%.
The combined increase in media rights costs is now expected to increase by 16,7% between 2022 and 2024.
The figures are based on data provided by the five largest members of the Betting and Gaming Council for betting on horse racing, then adjusted to include smaller operators, who also have to pay for media rights.
Michael Dugher, CEO of the Betting and Gaming Council, said: “BGC members are already making a record contribution to horse racing and these figures show this is set to increase. This comes despite a reduction in racing betting turnover over the past five years and a worrying decline in participation in horse racing betting overall.
Horse racing remains a hugely important and world-leading sport, enjoyed by millions of fans and, like the betting industry, continues to support large numbers of jobs. I know racing is trying to modernize and reach new fans, while also trying to recover from the Covid pandemic and deal with some difficult economic headwinds, as well as dealing with the hit to its funding caused by the Government. The betting industry is facing many of the same pressures on our revenues and costs.
The BGC and our members remain fully committed to working together with the sport's leadership, including the BHA and others, to ensure a better future for racing. But the fact that we are making a record and growing contribution to the sport cannot be ignored."
The projected costs come after the BGC announced that its members directly contributed £384 million to British horse racing last year in levies, media rights and sponsorship deals. These figures showed an increase on previous estimates for the contribution of the regulated sector, which had placed it at around £350m per year.
In addition, bookmakers have spent £125m on marketing to promote racing and betting through advertising and partnerships, which helps ensure vital terrestrial coverage of the sport and boosts revenue for print headlines. In addition to rising media rights costs, levy payments are expected to be £99 million in 2022/2023, up from £50 million in the 2016/2017 year, according to the Horserace Betting Levy Board.
This record investment has also enabled horse racing to use some of these revenues to deliver record prize money of £179,3 million in 2022. Horse racing is the second largest sport in the UK, second only to football, with over five million people attending around 1.400 matches a year across 59 racecourses.
However, its popularity is declining. In 2007, 17% of the population participated in horse racing betting in the previous year, but this fell to 10% in 2018. Meanwhile football overtook horse racing betting in the same period between 2017/2018 . The Department for Culture, Media and Sport has pledged to review the tax on horse racing by next year.
The Horseracing Levy, which is administered by the Horserace Betting Levy Board, goes towards improving sport, breeding and increasing veterinary care. Betting operators are working closely with the British Horseracing Authority and racing stakeholders on much-needed reforms to the meeting calendar and racing program which are expected to increase commercial returns from levy and media rights.
The regulated betting industry fully supports this unique opportunity to modernize horse racing so that it can realize its full commercial potential. The BGC is also working closely with the Government on the reforms proposed in the White Paper to ensure that those who enjoy gambling can continue to do so without unnecessary intrusion, whilst introducing better safeguards for the struggling minority.
Betting shops currently support around 42.000 jobs, contribute £1 billion a year in tax to the Treasury and a further £60 million in business rates to local councils. The wider regulated betting and gaming sector contributes £7,1 billion to the economy, generates £4,2 billion in tax and supports 110.000 jobs.
In April DCMS unveiled the Government's new White Paper on gambling reform, including a number of key measures that the BGC had campaigned for. These included a new mandatory ombudsman for the regulated sector, increased online spending controls and a new mandatory levy to fund research, education and treatment to tackle gambling-related harm and problem gambling .
Every month in Britain around 22,5 million adults have a gamble and the most recent Health Survey for England estimated that 0,4% of the adult population are problem gamblers. Meanwhile the black market in unsafe and unregulated online gambling is growing in the UK, with the numbers betting on these sites doubling in recent years and the amount staked running into billions.
