Sports betting ad ban threatens $135 million in TV ad revenue

Arvind Hickman
By Arvind Hickman | 21 April 2017

A ban on sports betting advertising during matches could cost TV networks north of $135 million, according to the latest SMI data and Nielsen figures.

The federal government could introduce new laws to ban gambling advertising during live sports events as early as next week, The Australian reports.

The ban would apply from siren to siren, which accounts for the majority of gambling ads during a sports broadcast and would restrict betting shops to promotions in pre- and post-game coverage and magazine shows.

At present, wagering ads on TV are restricted to 10% of advertising content during a match. For sports like NRL, this may amount to about seven or eight betting ads per match, but for AFL ad breaks vary depending on how many goals are scored.

A blanket ban would strike a significant financial blow to TV networks and the amount of revenue broadcasters and administration bodies are able to generate from live sport.

This would hurt the two richest codes most, the AFL and NRL, which are covered by Fox Sports, Seven and Nine.

In the past 12 months, betting shops spent $135 million on free-to-air metro and regional TV advertising, according to Nielsen figures. The biggest advertiser spender in the market is Sportsbet, followed by William Hill

Media agency bookings for TV gambling ads, which also includes Foxtel, grew by 19% to $141 million in 2016, according to Standard Media Index figures. These figures include a small proportion of lotto advertising, but do not include IPG Mediabrands agencies, which have William Hill on their books.

TV networks are strongly opposed to a ban on betting advertising during matches and argue that it will only encourage betting shops to advertise more on digital media like Facebook, where a high volume of ads are served.

“The reported gambling advertising restrictions would have a significant impact on the future value of sporting rights for FTA broadcasters and as a result we are likely to see more of them migrating to unregulated platforms run by foreign multinationals,” a Seven spokesperson said.

“It is more important than ever that we support Australian industry which is why we urge the government to act quickly on licence fee reductions for commercial television.”

Nine endorsed reform if it applied fairly to all media platforms. “We are prepared to work with Government on a path to reform for gambling advertising across all platforms. Measures targeting TV alone does not reflect the reality of how audiences are exposed to gambling advertising and the sensible approach would be to include all platforms.”

The gambling industry is somewhat resigned to restricting the number of wagering ads in line with mounting community concerns.

Responsible Wagering Australia, which represents the interests of the major betting shops, tells AdNews:

“RWA and its members recognise and appreciate there is growing public concern about the level of gambling advertising, in particular the level of gambling advertising that is seen by minors.

“We support government action to reduce the volume of wagering advertising, including during live sports telecasts.”

The move to curb betting ads is likely to receive broad political support, particularly from senate power broker Nick Xenophon, who has long championed the cause.

Xeonophon told The Australian that any moves to restrict gambling revenue should be offset by abolishing TV licence fees that cost FTA TV broadcasters about $100 million each year.

The federal government may pursue this trade off to try and appease TV networks, but such a move is likely to be met with stern resistance if it doesn't also apply to digital.

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