TabCorp was recently placed in a very difficult situation with the Victorian Government. The company’s pokie duopoly was disbanded just 46 days into the financial year, and would lose out on valuable revenue in the market. Now, TabCorp can look forward to some recovery, as the gaming firm has just coined an exclusivity deal with the NSW government.
For the past few years TabCorp has been the only land-based operator licensed in New South Wales. This week, the company extended its exclusivity agreement, so that local residents only have one option when they want to visit a bookmaker. TabCorp will be the only brick-and-mortar operator NSW until 2033. At that time, the local government can decide whether or not it will renew the company’s exclusivity deal yet again.
The deal will cost at least $75 million. TabCorp will pay $50 million up front and the remainder of the balance will be paid by 2024. It is one of the most expensive deals that the land-based gambling market has recently seen, but it will certainly benefit TabCorp in the long run. "This is a great outcome for TAB, but it is also the right outcome for the NSW racing industry,'' says David Attenborough, or TabCorp.
“This successful funding model returned $238.6 million to NSW's thoroughbred, harness and greyhound racing industries last finanical year.'' Australia’s gambling market is very competitive. There are plenty of options for sports fans who wish to wager on their favourite teams, so exclusivity is important.
By securing the spot as the only bookmaker in NSW, TabCorp can ensure that it will be the preferred choice over other competitors such as SportingBet and Tatts Group. The local gambling market will only continue to grow and expand. As such, it is important for companies to corner particular markets when possible. That is exactly what TabCorp has done in NSW, ensuring its success and profitability far into the future.