Britbet faces delayed launch over Jockey Club and Arena infighting

Crunch board meeting on Friday should decide the issue
Arena favours closer co-operation with the Tote

The immediate future of Britbet, which is due to replace the Tote as the sole operator of pool betting at the overwhelming majority of Britain’s racecourses next month, could be decided at a meeting of its board in London on Friday, when a delay to its proposed launch on 13 July will be one of the options for discussion.

Ascot and Chester are the only significant absentees from the Britbet project, which was formed as a joint venture between 55 courses to take control of racecourse pools when the Tote’s seven-year monopoly on pool betting expires next month. The monopoly was a condition of the Tote’s controversial sale to the bookmaker Fred Done in 2011, which many in the sport saw as a missed opportunity for racing to gain a foothold in the betting industry.

Since 2011, pool betting’s share of the racing market has declined from 4% to 3%. Britbet has ambitious plans to reverse the decline both on-course and online by bringing the pool-betting experience up to date, with proposed features including a “cash-out” option in jackpot-type bets, the opportunity for organised “syndicate” betting and a state-of-the-art mobile platform to exploit the rapidly growing market for phone betting.

However, its plans now appear to have been thrown into doubt by infighting on the Britbet board, as the company’s two biggest shareholders – Jockey Club Racecourses and Arena Racing Company (ARC) – argue over its future as a standalone enterprise owned by the tracks. While JCR is believed to be keen to press on with Britbet as planned, ARC is thought to favour closer co-operation with the Tote, which will maintain a strong presence in the retail and international markets after its monopoly expires.

The internal wrangling has been brought to a head by Done’s recent decision to sell the Tote’s pool-betting business to the Alizeti consortium, which is headed by Alex Frost, who is both a racehorse owner and breeder.

Alizeti has taken an initial quarter-share in the Tote and has a guaranteed option to buy the remaining 75% within three to five years in a deal which could be worth up to £150m.

Pool, or pari-mutuel, betting has a legal monopoly on racing bets in many major jurisdictions including France and Hong Kong. In Britain, however, it faces fierce competition from traditional bookmakers and more recent innovations such as betting exchanges, which share some of the peer-to-peer features of tote systems but allow customers to take a price.

The appeal of pari-mutuel betting to punters depends largely on the size of the pools, and there is clearly a concern that Britain’s, already small by international standards, will be split further if there are two operators chasing the same limited market from July.

Britbet, though, has been recruiting staff and working for many months towards a launch at the first opportunity. It also has high hopes that its image as a company being run entirely by and for racecourses and racing could help to win back at least some of the business that had been lost since the sale to Done in 2011.

Fifty-five racecourses – with several million customers each year – could also prove invaluable in terms of advertising and cross-promoting its online business.

Friday’s meeting of the Britbet board, when representatives of JCR and ARC will attempt to thrash out their differences, could now determine whether any of these possibilities will be tested or realised. If ARC is unwilling to commit its 16 tracks to the Britbet project, the likelihood that a stake will ever be accepted at a Britbet-branded racecourse window will be significantly reduced.

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