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Punt to Win |
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5/12/2003 edition TAB Merger It's not a must for punters With the proposed merger of Tabcorp and TAB Limited a hot topic, there is also lot of hot air about it in the racing media. It has been seriously claimed that because the proposed merger will result in larger tote pools that punters will get better value. That is mathematically false. Unless a greater percentage of the pool is returned to punters and a smaller percentage of the pool kept by the tote, there is not one cent's worth of extra value. It's absolutely irrelevant whether the pool is $100,000 or $1,000,000. If the tote takes out 15% then a $100,000 pool has $85,000 left for the winning punters while a $1,000,000 pool has exactly the same percentage with $850,000 left for the winning punters. It's as simple as that. Making larger pools does not create value. As a group punters are also not better off should there be, and this is debatable, greater certainty about the prices they will obtain in larger pools. For argument's sake let's consider two pools, Pool A and Pool B, of $300,000 each after the tote has taken out its cut. If in Pool A a horse firmed from $5.00 to $4.00 as a result of late money and in Pool B firmed marginally from $5.20 to $5.00 how are punters possibly better off? If the pools were combined the horse would have fimed from $5.10 to $4.50. How are punters possibly better off? Punters betting in Pool B instead of getting $5.00 ended worse off with $4.50. Punters in Pool A got $4.50 instead of $4.00. But that is just redistributing the money from punters in Pool B. In this example the group of punters were no better off. It was simply a case of taking money from one group of punters and redistributing it to another group of punters, robbing Peter to pay Paul. This edition of Punt to Win: Back Tote Longshots?
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