Hollywood - the gloves are off

The dispute between Bookmakers and Tellytrack continues with Hollywood delivering a telling blow with a letter addressed to international role-players. The unabridged communication is quoted below – you be the judge!

We address this letter to all parties who supply, or previously supplied live film and commentary of race meetings through the Multichoice DStv bouquet, channel 239 to viewers in the Republic of South Africa. The purpose of this letter is to rectify false statements being disseminated by Phumelela and Tellytrack regarding the alleged lack of monetary contribution made by South African bookmakers to the international suppliers of these live racing films and commentaries. The local broadcaster, Tellytrack, no longer shows international racing on its commercial channel, affecting home-viewers in particular. As a result, betting turnovers are in serious decline. The reason, put forward by Phumelela and Tellytrack, is that international content providers are not getting their fair share of revenues, and have accordingly, instructed Tellytrack to remove international content from the commercial channel.

The monitoring of revenue streams for gambling in South Africa is highly regulated by provincial Gambling Boards, who have unfettered access, by means of computerised recordings, to all betting transactions. In terms of their respective Gambling Acts, the Gambling Boards collect and distribute all statutory taxes and levies made from betting transactions. A large portion (50% of statutory contributions in all major provinces) is then onward remitted to the race course operators in those jurisdictions where live racing is conducted. The race course operators (Phumelela-R54m, Gold Circle-R41m and Kenilworth Racing-R18m) were enriched by approximately *R113 million from South African bookmakers’ levies in the financial year ended 31 July 2013.

These levies were generated in a ratio of approximately 70% from South African racing and 30% on international racing product. Your international product therefore generated at least **R33.9 million from South African Bookmakers – which amount ended up in the bank accounts of the race course operators. The derogatory statements made by Tellytrack and Phumelela regarding the bookmakers in South Africa leaves us with the strong suspicion that the race course operators are not passing on all, or perhaps, even part of the vast revenues, that they receive from bookmakers, over to you – the suppliers of the product. We are convinced that if you demand and receive these monies from the racecourse operators, which are generated by racing under your jurisdiction, it would eliminate any difficulties you may have in supplying bookmakers in South Africa with the live film and commentary on racing that falls under your jurisdiction.

If the race course operators refuse to pass on what is generated by racing under your jurisdiction, we (and most bookmakers in South Africa) are prepared to lobby the respective Gambling Boards to assist with repatriating the funds due to you.

DERMOT O’CONNELL
Betting Operations Manager
hollywoodbets.net

some massive statements here

WOW - Now I expect Phum should take action if they are "clean" as the "suspicion" mentioned is very serious - Let's sit back and watch this since we have no UK racing to watch for months

Hollywood are not the only party accusing "P" of not passing on the dues to the overseas providers-this has been alleged before ......just can't remember if it was on the forum or a comment in Sporting Post.
If it is shown that the operators have been dishonest,it could turn horseracing and gambling in SA on its head so Although I believe they tend to divert certain issues like tote dividends etc., I hope that this is a misunderstanding as the alternative could be very damaging to an industry that already has trust issues!
This is going to get very interesting either way!

Well done Hollywood let's hope we get some overseas races

The entire issue has been a shocker from day one and at the end of the day no winners just bad feelings and massive damage to horseracing in general.

We have the RA , the NHA and "P" all under "unfortunate" scrutiny right now .....and none looking all that good!
These issues need to be cleared up soon for the sake of the industry!

Surely Sporting Post means the gloves are ON.
No? Yes?

Bare knuckles Mac

Well, my old Faux, Rob, will not agree with my views on this one. Anyway, I think that we both want the same for racing, in spite of some differences. Ultimately, I respect his views, as much as I am steadfast in mine.

Another point is that I have often referred to the major problem in handicapping as being the mindset of the handicappers. Maybe my views are also all about my mindset. However, I try to let logic prevail. And when that happens, both mine and the opposing views, have their merits. Its a tough one, overall and not just a "stuff the Operators, ag shame, poor Hollywood" sithation. This is about business.... big business.

Firstly, my views on the issue -
1)It costs R700M plus, to run racing nationally
2)The bookmakers contribute R113M towards those costs.
3)That revenue is deducted from Punters winnings.
4)That money, in part or in total, is NOT and NEVER has been paid to Operators. It goes to PROVINCIAL GOVERNMENT.
5)PROVINCIAL GOVERNMENT, after receiving 6%, then pay 3% back to racing/Operators, but only in the provinces where racing is staged. For instance, Mphumalanga and North West province revenues do not get paid over...
6)The ruling on this issue was made by Govt and is administered by Govt, not the Operators.
Fundamental principle which remains is that the Punter pays this money over, not the bookie. It is deducted from the winnings of the Punter.

Further, my views overall-
1) There are some 300 bookies in Sa. 156 of them have already signed Tellytrack agreements and are going on as per normal.
2)The whole letter as published appears to be a smokescreen, to try and avoid the charges against Hollywood. The letter is very false. Agreements with Overseas customers have nothing to do with the Provincial Govt levies. These were in place long before any overseas contracts. The R113M is far short of what should be going into running racing from bookies, when turnover is compared.
3)The same people who now suddenly want to take the apparent moral high ground are the same people who hurt racing and didnt bat an eyelid for years, when requested to drop just the open bet.

Finally, there is the question of breach of contract from Multichoice. There is also the question of wanting to take something for free, namely Tellytrack. Whilst 156 bookies are already paying, Hollywood are refusing.

I dont know all of the legal details, nor am I a knowlegeable person on the law. But, to me, it appears that Hollywood have broken the law.

I really hope that the two parties step out of the ring, into the boardroom and find common ground, on this one. Both are necessary in racing.

Hollywood are not refusing LG

Louis,I am not going to debate this as it makes sense to let it play out.
Hollywood would not have taken this position without legal opinion though, so time will tell!