Online sportsbooks and the Asian market

[AYCE]

For the last couple years, we keep hearing books out there telling you how big they are and how many customers they have from around the world. They also tell you that they have plans for expanding their market to different areas, one of them is Asia, which could be the one with highest potential in the future with its population number.

One of the most important targets in the Asian market is Hong Kong.

But as I have said it at here before, they will not have any success there in the near future.

Like most of the countries and cities in Asia, gambling is illegal there and with much strict regulations and laws than in the States or Europe. Hong Kong, for example, the only legalized gambling activities are horse racing and lottory and both are operated by the government.

Last Tuesday, 02/24, Mr Alan Weinrib (boss of Easybets) cancelled a press conference at Hong Kong which was planned for business promotion.

He was told that he could violate the local laws and could be in trouble for promoting gambling there.

Recently, Easybets has a new look at their website. And more importantly, they mentioned that they have moved to Antigua. As we all know, they are from Ireland but I have some serious doubts on how and where are they operated the last year or so. This is actually a good thing for them to finally settle down at a place that can provide some confidence to the bettors.

I really hope they can improve their services and back to the right track as they were before. Who knows, maybe one day I will be back to there and play again like what I did with SIA.

Now back to the Asian market thing, please don't waste your time, bookies.

You may have thousands customers coming from Hong Kong and you may have been also thinking about the HUGE China market in the future.

But never try to believe you can do it publicly there, like WH, LB, etc, they all have huge business with customers from the far east but they all tend to maintain it as very low profile.

Just a piece of personal opinion, the system over there is much complicated than you could expect. There are so many varibles that you may not think of when you are operating at here.

Think carefully and do some extensive research before you decide to do it.

[AussieVamp2]

Ray,

Actually read an article in the South China Morning Post the other day about the Hong Kong jockey club and internet betting... worth having a look

[AussieVamp2]

Ray,

On the sites that you know about, if you download the right fonts/viewers etc. can you see the numbers?

I am not going to be able to read Asian languages anytime soon

[AYCE]

Depends on what you want, AV.

If you are talking about soccer Asian lines, sorry, no. But you can check my profile out.

They usually type the lines in Chinese even you will see the numbers, if you don't know the lines, eg, -.5/-1 (in Chinese), it won't help you much.

However, if you are talking about horse racing, you should get the numbers without any problems.

I believe you are talking about the overnight odds and the live feeds. Even you don't know the Chinese names of the horses, but as long as you don't mess up with their numbers from 1-14, you will get the numbers/live odds you want and without any problems.

If you are using IE5, just right click your mouse on the page (not over any picture but on the text), then click on encoding and chose either Chinese simplified or traditional, you should be seeing the normal text and numbers without any problems.

If you want the sites url, just check my profile. I am actually surprised that you will have time to check SCMP out. They are a good newspaper, however, they are no where come close to good when you are talking about betting info.

[DarwinAllSports]

Ayce,

We offer betting on all HKJC races and it has been very successful. I think that this is the article that somebody mentioned.


Kind regards,

Aj
IAS Ltd

Bold action will Net fortune


Lawrence Wadey
With race fans, football fans and techno heads standing on the brink of a betting Utopia, there is a pressing need for the Government to produce a coherent policy to shape the way Hong Kong benefits from the new economy that will imminently change the face of gambling.

The Jockey Club is doing their bit to enter this Brave New World as underlined by chief executive Lawrence Wong's surprise announcement on Friday that they will be offering Internet betting services from, hopefully, the start of next season.

At first this will only be available for domestic punters, while any teething problems are ironed out. But obviously the market is global, as it is for football betting.

The difference between the two sports is that with racing it will be, on balance, domestic and overseas punters betting with the Hong Kong Jockey Club, whereas with football it is domestic punters wanting to bet on an overseas product.

It really is no exaggeration to say that within a year or two it will be possible to bet on, and watch or listen to, any horse race or football match virtually anywhere in the world on your mobile telephone - never mind the Internet.

This is the way of the future, according to the world's biggest bookmakers, Ladbrokes of England, which recently produced its own study on this matter, and is already eagerly pursuing a massive investment strategy along these lines. And clearly Vodaphone, the world's biggest mobile phone company, has recognised the link between new technologies and sport, signing a £30 million four-year sponsorship deal with footballing giants Manchester United.

The Government, in the wake of the Jockey Club's commitment to Internet betting, should produce the equivalent of a White Paper which can be publicly debated as soon as possible.

The alternative is that society lurches from one ad hoc decision to another concerning football, racing and Internet and mobile phone betting, and that potentially massive benefits are either not maximised or, worse still, allowed to leak abroad.

There is already a government-sponsored committee looking at whether betting on football should be legalised.

This, itself, is an almost farcical fait accompli as almost anyone who wants to have a bet on soccer is already doing so and millions and millions in taxable revenue is being lost and will continue to be lost for at least another year (when the committee reports) as it goes to either illegal or overseas bookmakers.

The betting on the Internet, for instance, raises all sorts of issues and opens up a kind of Utopia of which Thomas More would have been proud.

The biggest issue is that for Hong Kong, its success is probably predicated upon a change in the tax structure facing the Jockey Club.

At the moment the Club is taxed on turnover, which is why its take-out from the pools averages some 19 per cent.

Illegal bookmakers or Internet bookmakers, domiciled in offshore tax havens, face no tax at all and thus produce odds on Hong Kong racing which are more generous than those currently offered by the Jockey Club.

But if the Government was to take the bold and insightful step of changing betting tax from a turnover to a profits tax then the Jockey Club could reduce its take-out by a significant amount.

The odds offered by the Jockey Club would then become competitive with bookmakers of whatever type, whether illegal or on the Internet, and once they become competitive they would wipe them out as the Jockey Club has a massive integrity advantage and much greater pool size.

With the Jockey Club, you can more or less have what you like on and not worry about being paid.

Such a change in the tax structure, coupled with the Jockey Club's development of Internet betting, would almost certainly lead to more revenue for the Government rather than less.

It really does appear to be one of those extraordinary no-lose situations.

The Jockey Club's pool size would, within a year or two, grow significantly as illegal bookmakers found they couldn't compete with the new Jockey Club odds which returned say, $90 in every $100 bet to punters via dividends instead of the current $81.

In the shape of the Jockey Club, the Government has the perfect body with its technical expertise and its worldwide reputation for integrity, through which to fully exploit the opportunities of this Brave New World of betting.

These opportunities are bounded only by the Government's foresight.



ends

[AussieVamp2]

AJ,

Yeah, that is the article


Ray - yes it was soccer I was actually talking about - horse racing not really my thing, thanks

well, don't read the SCMP daily or anything, actually saw a link - but do browse there occasionally

[AYCE]

AJ,

I know you guys are the ONLY one that currently have offering HKJC races online and in fact I'm a long time customer of yours (just haven't played for a while).

Thats a pretty interesting article from SCMP.

For others, here is another one from ESPN, with some rather basic info about the racing situation at HK.

Horse racing finds a home in Hong Kong




By Ed McNamara
Special to ESPN.com


HONG KONG -- A row of high-rise apartments overlook the illuminated backstretch of the 153-year-old track in the heart of the city. Filling the infield of the undulating, 7-furlong grass course are five soccer fields, two tennis courts, a roller-hockey rink and a jogging path. If there's a racetrack anywhere that resembles Happy Valley, no one knows where it is.


Imagine a track in the middle of New York's Times Square and you're getting the picture. Appropriately, the 12-story Times Square shopping mall looms over the first turn on the clockwise, asymmetrical layout. At 12:45 a.m. on Jan. 1, the first stakes of the next 1,000 years, the Millennium Cup, will go off at the Valley. The field will run past a 10-story sign of multicolored lights saying "Times Square 2000. Yeah."


Jockey Shane Sellers grew up in Louisiana's Cajun country, where racing has been part of the culture for centuries. His visit to Hong Kong was a revelation, because there's nothing like this down on the bayou.


"I was very impressed with Happy Valley," he said. "Here is this beautiful track, right in the middle of the city, with tall, brightly lit buildings all around."


On a warm December night, 25,412 fans packed the nine-story grandstand to watch a seven-race program filled with maidens and animals that would be claimers or allowance types in North America. More than 9,000 others watched via simulcast at Hong Kong's other track, Sha Tin.


The second annual International Jockeys Championship, which included Frankie Dettori, Olivier Peslier, Michael Kinane and Sellers, boosted the attendance, but the riding stars had little to do with the total betting handle of approximately $124 million (U.S.). Actually, that's about 4 percent below average for a card in a manic metropolis where they're crazy about horses. Hong Kong, the southeastern China port where East meets West, bills itself as the City of Life. City of Action is more like it. This small place loves to live large.


Happy Valley is an odd name for a track built upon land that once was a malaria-infested swamp. Then again, Death Valley lacks commercial potential, and so does Mosquito Downs. Many victims of the biting bugs rest in the old cemeteries across the four-lane road behind the nine-level grandstand. These unfortunate souls are among the few bodies at rest in a vertical city with a passion for accumulating, consuming and spending. Few pastimes are more popular than investing in short-term equine futures.


Hong Kong, which means "fragrant island," is on the same latitude as Honolulu. Its 6.8 million residents are jammed into only 685 square miles, making it one of the most densely populated areas in the world. A five-minute ferry ride north of Hong Kong island, where Happy Valley is located, is the Kowloon peninsula, which runs into the New Territories, which share the southeastern border of mainland China. There also are 260 outlying islands, many of them uninhabited.


The British, who ran Hong Kong from 1841 until it became a Special Administrative Region of the People's Republic of China on July 1, 1997, staged the first race meeting at Happy Valley in 1846. Over the years it has become one of the most venerated sports sites in the Far East. In 1978, Sha Tin (meaning "sand field") was opened on reclaimed land in the New Territories.


"Both racecourses are among the best in the world," said Kinane, an Irishman who rides half the year in Hong Kong. "They lack for nothing. Happy Valley is pretty tight, and you're very aware of the crowd because it's right on top of you. I enjoy it. It gets your heart pumping."


All of the international events are held at state-of-the-art Sha Tin, whose 1 3/16-mile grass course encircles an all-weather surface. Like Happy Valley, races are run clockwise amid a unique backdrop. The view of Sha Tin's long backstretch includes nearby mountains and 14 high-rises.


"Sha Tin is a classic track with easy turns," said Basil Marcus, a South African who has ridden full-time in Hong Kong since 1990. "It's a very fair track. There are very few hard-luck stories there."


Racing is conducted only twice a week, on Wednesday evening at Happy Valley and on Saturday or Sunday afternoon at Sha Tin. Last year the average crowd at Sha Tin was 33,000; for Happy Valley, it was 23,000. Fans cheer as passionately as English soccer followers but are far better behaved.


"Racing in Hong Kong is more exciting than anywhere else in the world," Marcus said. "There are a limited number of races and a limited number of horses, so that makes each race very special indeed."


The season runs from mid-September until late June, with a hiatus forced by summer's brutal heat and humidity. "Both horses and humans need a break," said Paulus S. Lee, Director of Finance and Central Services for the Hong Kong Jockey Club.


Ninety percent of the races are handicaps, which draw competitive, full fields of 12 to 14. Rarely are a favorite's odds below 2-1, and exotic payoffs can be huge. The minimum bet is $10 HK (about $1.25 U.S.), so the little fish can swim with the big ones in mutuel pools that average $129 million (U.S.) per meeting. Besides on-track play, 125 OTBs and 778,000 telephone accounts make millions change hands and keep hundreds employed. Of the Jockey Club's more than 4,000 full-time employees, about 10 percent work in betting services.


According to the financial report by the auditing firm of Price Waterhouse, the HKJC returns 82 percent of the handle to bettors and gives 13 percent to the government, keeping only 4 percent for operating expenses and reinvestment and donating 1 percent to charities. Among the Jockey Club's varied creations are Hong Kong University of Science and Technology, based on the MIT concept, an 18-hole golf course, and the Jockey Club Centre for Positive Aging to treat patients with Alzheimer's Disease.


Last year the HKJC gave more than $137 million (U.S.) to hospitals and education and paid about $1.5 billion (U.S.) in taxes, more than 10.5 percent of Hong Kong's assessment.


"Having one entity provide that much of a government's taxes is amazing," Lee said. "Besides that, we try to do something for the community with the betting money."


Another aim has been to gain recognition for Hong Kong on racing's world stage.


"Our racing is not top-class, compared to England, France and the United States," Lee said, "but we're working hard trying to get it to that point."


The Hong Kong International Races on Dec. 12 at Sha Tin were a spectacular success, drawing 27 horses from eight foreign countries -- France (6), England (8), the United States (2), Australia (3), New Zealand (2), Dubai (3 ), Japan (2) and Ireland -- who took on the local thoroughbreds in a four-race, $3.76 million (U.S.) mini-Breeders' Cup.


The Europeans dominated with three victories by Breeders' Cup also-rans, France's Jim and Tonic (Cup) and Borgia (Vase) and England's Docksider (Mile), after Hong Kong-based Fairy King Prawn got a prolonged ovation for taking the $681,580 Sprint, the world's richest 5-furlong race. The 1¼-mile Cup offered a purse of $1.286 million (U.S.) for the first Group I event ever run in Hong Kong.


A winner on the undercard was named Asia Rising, which could have been the theme for a hazy, cloudy afternoon when a nine-race card drew 57,909 and an astonishing $158 million (U.S.) was bet. Plans to upgrade International day are in the works, and more stars will come a long way to chase big money.


"The days when you could bring a Group 2 horse to win a Hong Kong International race are long past," England-based jockey Frankie Dettori said. "Now you need a world-class Group I horse."


Although gambling remains illegal in mainland China, the Big Red Machine wisely has kept its hands off Hong Kong's economy and its racing, adhering to a "One Country, Two Systems" policy since the 1997 handover.


Communists like money, too, even if it comes from a shrine to unbridled capitalism. If Confucius never said this, he should have: Never slaughter a cash cow.

[AYCE]

Now back to that SCMP article.

I'm not suprised at all by the "late" action of the HKJC of "probably" going online by next season.

If you have been followed HK racing for a while , you should understand what kind of business and what kind of pool we are talking about here.

HKJC no doubt is the richest organization/business in his type. They can donate millions to the charities and provide billions tax money to the government each year. They always willing to spend money on new ideas and new technology in the past. They spent millions dollars on different kind of tracks in the last 10-15 years to replace the sand track at both Happy Valley and Shatin as attempted to improve the quality of the race and provide more protections to the horse. Both tracks had been re-designed number of times to insure the safety of the jockies. They also spent tons on improving the quality of the turf as you may know that Shatin is one of the most beautiful tracks in the world.

As on bettings, I believe they are one of the first (if not the only) to provide individual OTB terminals for customers (don't know the present situation but I will expect that could be wireless within several years). They are also one of the few tracks in the world with so many different exotic options with huge jackpot of payoff.

So, why are they so late on this "internet" thing? And why are they so "conservative" on "locals only"?

Yes, like Lawrence Wadey said, once HKJC can't solve the tax problem and open the market for gobal betting and they may face a high degree of competition from those "legal/illegal" books (depends on your point of view) out there which don't need to pay any kind of tax virtually and can provide payoff with better than 82%, it would create some worries.

But believe it or not, thats NOT the main issue here.

Like Lawrence said, with the Jockey Club, you can more or less have what you like on and not worry about being paid.

When you are talking about the issue of being paid and the safety of your money, no any books out there in the world can be compared with HKJC. If they will provide the same products online and even with a slightly worst odds than those offshores or foreigner books, I don't think they will be afraid of the competition at all.

I believe there are several main reasons here,

a) the economy of HK had been slow down the last several years. (In fact, its the whole Asia).

If my info was correct, despite any economic changes of the last 50 years, the betting growth of HK racing is always positive until the last couple years. Some people blame it on Lawrence Wong which didn't do much since he replaced the British general to be the CEO of HKJC, but I believe most of it is just a result of the going down in the economy.

Thats why they want to keep a lot of thing NOT going too fast in the present situation.

b) The growth of the internet - the growth of internet is rapidly in HK and Asia, HOWEVER, its NOT that as that kind of crazy as in here. Electronic moneies are not as common as it was at here.

Also, internet is a very sensitive issue in China (which is always described by most people as the last largest market of all kind in the world), not only because of the protection and monopoly issue, but also the "invasion of Western cultures" issue. As a part of China since 97, when something has been related to gambling and internet and must preformed by the government (HKJC not exactly a part of the government but most of its policies has political implications), it must be in a "steady and stable" pace.

Currently, in US, there are hundreds of websites out there like this one which is only gambling related and can generate enough revenues for it to survive. In HK, even horse racing is a HUGE business and bigger than life for a lot of people. There are only a hand full of websites out there that can provide similar services/product as BW in here. And most of them are just a by-product/section of the online newspapers. None of them can generate revenues for themselves to survive.

There are some paid services out there to provide info and data but I don't know any of them has good success yet.

HK Star Net has been one of the first to provide something interactive like BW here for HK racing but it didn't have any success at all. Personally, I know quite a few guys had put on many efforts on something similar but failed for the last 5 years in HK.

In short, unlike in US or Europe in sports betting, horse racing and internet are still 2 different kind of things in HK, there are stil a long way to go there.

3) Finally, the issue of fairness and the goal of HKJC.

When you notice that the pool is so huge in HK, no doubt that there will be lot of "syndicate money" coming from around the world. There are curretly many top gambling groups betting on every single races in HK. But unlike some of the offshores, HKJC has been very clear on this issue. They do not welcome professional gamblers. Their job is to protect the general betting plubics and their pratices and policies will always working towards this goal.

HKJC is a non-profit seeking organization, making money is not their goal.

Protect the general public's interest is their ultimate goal.

Internet betting is definitely something new to them, I'm pretty sure that about 70% of the betting public in HK are not familiar with the internet betting concept but this is not something to most of the pros overseas. There is no reason for HKJC to rush to "provide something new to our customers" when they are not prepared for it.

But in a conclusion, its still a good thing that they are willing to try it after all. Will it become something for gobal betting in the short future? No doubt about it, will it become as successful as soccer betting as Serie A and Perime League? I don't know but it won't surprise me at all if it will have great success. Will there be a tax cut by the government because of the online issue? I highly doubt it.

How will this affect the books out there like DAS in the future? Say, future plannings, etc...

AJ, I like to hear your opinions then.