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Sometime in 2017, racing will awake from its collective slumber and make changes to the lazy business model that has served it post-privatisation.
This won’t be the result of much forward-thinking, but a necessary reaction to a simple reality.
This isn’t a call for ‘industry leaders’ (whoever the hell they are) to get their act together, but to point out that they will have a range of choices to make sometime around 2017, when a simple problem will hit.
What’s the problem?
In three words: not enough greyhounds.
As otherwise sensible people have been falling over themselves to exaggerate how many greyhounds are bred in Australia for political purposes, when you analyse the numbers objectively, a completely different picture emerges.
Greyhounds have a quasi-seasonal breeding pattern, so you have to do a few mathematical transformations for accurate estimates of the annual numbers of greyhounds currently being bred. I’ve put the details at the bottom, but here’s a graph of how many greyhounds would be expected annually from the litters produced in each two-month period.
Greyhound breeding numbers are falling off a cliff pic.twitter.com/sjakxKGG92
— Nathan Absalom (@Nathan_Absalom) January 11, 2016
Breeding numbers were reasonably stable from 2012 until around April 2015, producing around 17,000 pups a year. Since April 2015, breeding has fallen off a cliff, and when the progeny begin to race, we’re looking at less than 10,000 pups a year being produced.
Currently, Australia stages approximately 3700 greyhound meetings a year, with a staggering 800-plus individual greyhounds racing each day. The drop in breeding numbers has simply been too deep and too sustained for this volume of racing to continue. Sometime in 2017, choices will have to be made.
Is this really a problem for racing?
Back in the 1990s, the TABs of NSW and Victoria were sold, contracts were rewritten, and Racing Authorities, the TAB and Sky settled on a model. To maintain market share in the face of competition from other forms of gambling, we were presented with wall-to-wall racing.
Thoroughbreds, greyhounds and harness, from the morning to the evening, every 90 seconds or so. Don’t give the punter a chance to study the form, just give them a chance to have a punt. In many cases, there wasn’t an increase in racing, simply a reorganisation of races to get as many of them on Sky and the TAB as they could.
But since the TAB was privatised things have changed, with online bookies and other forms of gambling threatening revenue streams for racing. Really, the business model should have evolved by now, but racing is a large and cumbersome beast, whose multiple players are resistant to change.
What could happen: the Victorian situation
The maths are simple, either each greyhound races more, fewer meetings or races are run, fewer greyhounds enter each race or, most likely, a mixture of the above. But this almost certainly won’t happen uniformly across the nation.
Greyhound Racing Victoria (GRV) is in exceptional financial health, with an infrastructure and skills base the envy of others. Their financial muscle will mean that, unlike other states, GRV doesn’t have to make these choices, but could follow quickly should other states successfully innovate.
Victoria have also made a series of decisions designed to give each racing code a greater level of independence. The income the codes receive is more or less correlated with what code is being punted on, and whether you agree with the money spent on their own racing channel or not, it gives the thoroughbreds greater independence to make decisions that suit themselves.
However, NSW has a different structure that gives little incentive to innovate. Racing NSW profits handsomely when people punt on the TAB, even when that bet is on the Victorian greyhounds. The idea that the Racing Authority where the bet is placed gets the cash, rather than where the race is run, is an anachronism that Victoria may unilaterally try to change when they find themselves running greyhound races simply so Racing NSW can offer higher prizemoney than them.
What could happen: the NSW situation
Greyhound Racing NSW (GRNSW) has far less freedom to make choices. In NSW there are two concurrent bodies, the Joint Working Group of GRNSW and the Special Commission of Inquiry, looking to introduce measures to restrict breeding to levels above current. ‘Solving yesterday’s problems tomorrow’ would be an appropriate motto.
On the positive side, the joint working group is making some effort to look at the problems they will face in the near future. A shift in the focus of some tracks to be ‘centres of excellence’ and involve themselves more with education and preparation at the expense of racing, reduction in field sizes, and more efficient grading policies are being considered.
However, the conflicts between the different players have the potential to slow or block this process, in one case with proposed reductions in field sizes to six. This hurts the TAB, Sky Channel and both the harness and thoroughbred codes, as races of six reduce their income but have the same costs and time to broadcast, and a fear that exotic betting will be hurt where the TAB takes a larger cut.
However, if you own a greyhound, you’re more likely to win a race of six than eight. With fewer greyhounds bred, you’re a winner out of this. There are very strong arguments for reducing the field sizes for inexperienced greyhounds, which would result in cleaner racing and more confident young chasers, and this should be trialled sooner rather than later.
What has happened: the Queensland situation
With this in mind, it’s worth considering what has happened in Queensland. By making the assumption that nothing had to be done but collect the money and spend it, Racing Queensland is supposedly in a terrible financial situation, and it’s not clear where to go next.
Other Racing authorities could find themselves in a similar situation, where they’ve spent money that suddenly ceases to come in, leaving them with a set of choices where none of them appeal.
*Nerdy explanation of data transformations: the number of litters produced on a two-monthly basis from 2012 to 2015 was downloaded from the GRV site FastTrack, and the two-monthly numbers from 2012-2014 were averaged to attain a standard number of litters for each two-month period. By dividing the two-monthly number by the standard number and multiplying by 17 200 (pups born annually in 2012-2014), we get the approximate annual greyhounds bred in 2012, 2013, 2014 and 2015 (red in the graph). December 2015 is not counted.
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