Bookmakers Come to Terms with BHB

British horseracing officials are heralding a recent agreement between the British Horseracing Board and leading bookmakers as progress, but some industry insiders aren't so enthusiastic.

On Wednesday five of the country's biggest bookmakers inked a deal with the BHB for commercial use of data. The deal, which runs for five years, gives Ladbrokes, William Hill, Coral, Stanley Leisure and Dones the use of the data for their betting shops and telephone and Internet operations.

"[The agreement] will have implications worldwide. We are going to have the football people, the golf people. . . everyone is going to be claiming that they have database rights."

- Warwick Bartlett
British Betting Office Association

In exchange for the data, which includes race fixtures, race participants and the number of horses in each race, bookmakers will pay 10 percent of the gross profits they make from British races back to the BHB.

The board is confident that other British and Irish bookmakers will follow suite and predicts that once all major bookmakers have climbed on board, more than £600 million could be generated for British racing over the next five years.

Warwick Bartlett, the chairman of the British Betting Office Association, worries that the agreement could open up a can of worms.

"It will have implications worldwide," he said. "We are going to have the football people, the golf people. . . everyone is going to be claiming that they have database rights."

With the deal in place, the board and William Hill close the book on a lengthy legal battle over rights to the data. The U.K. firm last year challenged the BHB's claim that information on races couldn't be posted by bookmakers without a licensing agreement. A British High Court ruled against William Hill in February. An appeal by William Hill landed the case in the European Court of Justice, where the two sides were awaiting a decision before this week's deal was struck.

Despite the settling of the race data issue, Bartlett doesn't paint a rosy picture for the future. He pointed out that bookmakers still must secure an agreement that will allow them to carry race pictures in their betting shops. Officials with the Racecourse Association and bookmakers are scheduled to meet Tuesday to iron out an agreement.

"This is an historic day for the British racing and betting industries."

- Peter Savill
British Horseracing Board

Bartlett said the two sides are far apart in negotiations. The current deal is for £8 million. The RCA is looking to increase that to £50 million, while bookmakers appear willing to go only as high as £20 million.

Animosity between British bookmakers and the racing industry has increased steadily over the years. With the BHB and track owners lobbying for increased licensing fees, bookmakers have turned elsewhere for racing action in recent months. To offset this struggle, bookmakers have been offering race betting from Ireland, Italy, the United States and even France. "We are bringing it in from anywhere because we want our punters to bet on anything but British horseracing," Bartlett said.

BHB Chairman Peter Savill is much more optimistic about the prospect of finding common ground.

"This is an historic day for the British racing and betting industries," Savill said. "We have agreed to a long-term deal which will enable us to put aside our previous differences and work together to develop British racing as a sport with an increasing appeal to punters, spectators, viewers and those who work in the industry."

"I am confident that the relationship between racing and betting will now flourish."

- John Brown
William Hill

William Hill Chairman John Brown is pleased as well.

"I am very pleased that a data deal, which I believe to be fair to both industries, which will ensure the continuation of no deductions to punters, has been achieved," he said. "I am confident that the relationship between racing and betting will now flourish."

John Whittaker, the Managing Director of the Betting Division of Stanley Leisure, is pleased with the agreement, but was hoping it could have been tweaked.

"While we would have preferred to have seen a better differential rate for the smaller shops, we have decided to take a pragmatic view on the deal as a whole and sign the license agreement," he said. "We are pleased that we have managed to overcome the issue of data and that we will be able to offer our customers the opportunity to bet on British horseracing from May 1 (the expiration date for the current agreement with bookmakers on the use of photos and pictures from the tracks).

Terms of Agreement

License: The license is a non-exclusive license to use data for the purpose of effecting betting transactions across all relevant platforms for operations based in Great Britain.
Term: Five years.

Charges: Each bookmaker will pay an annual charge of 10 percent of gross profits from race betting on races taking place in Great Britain, other than in respect of over-the-counter bets transacted in betting offices where the charge payable by each bookmaker will be calculated by reference to the gross profit in each year of each betting office owned or operated by the bookmaker as follows:

Year	Gross Profit Range	Charge
Year 1	Betting office whose gross profit on horse race betting is £150,000 or more per year -	10% of such gross profit.
	Betting office whose gross profit on horse race betting is less than £150,000 -	("x"/£150,000) x 10% of such gross profit where "x" equals the betting offices gross profit.
Years 2-5	Betting office whose gross profit on horse race betting is £75,000 or more per year -	10% of such gross profit.
	Betting office whose gross profit on horse race betting is less than £75,000 -	("x"/£75,000) x 10% of such gross profit where "x" equals the betting offices gross profit.

Payment procedures: A general right of offset in respect to the charges payable to BHB has been provided to bookmakers in relation to payments made under a levy scheme.
Other Terms: It has been further agreed that:
1. the same terms will be offered to on course bookmakers, as set out above, except that on course bookmakers (other than bookmakers operating on course bookmaking shops where the terms set out above apply) will in the first year of the license pay £15 inc VAT for marker sheets, an increase of £2 from the current charge of £13, in place of the standard data charge for the first year as set out above;
2. all legal proceedings regarding judicial review of the 41st Levy Scheme will be withdrawn;
3. all legal proceedings with the bookmakers who have signed data licenses today with regard to the past use of data on internet sites are withdrawn on the basis that all outstanding monies are paid; and
4. all complaints relating to data made to the Office of Fair Trading by the CBA and bookmakers who have signed the data license today are withdrawn.