Tabcorp Might Be Better Off Without Ads

In a Nov. 18 submission to a parliamentary inquiry on online gambling, Tabcorp noted the efficacy of consumer protection initiatives is limited "without addressing the fact there is too much gambling advertising." This echoes the firm's view over several earnings calls that there should be further restrictions on gambling advertising, including when and where advertisements can be aired or shown. For the purposes of the inquiry, Tabcorp's submission makes sense: there is a strong link between advertising and an increase in gambling activity. While this approach may appear odd for a gambling company, we don't think it is a purely selfless endeavour: more advertising merely equates to more competition. We think tighter restrictions on advertising would favour the most recognisable brands: Sportsbet and TAB. We estimate Sportsbet and Tabcorp together represent more than 80% of the betting market, with Sportsbet leading share in online betting, and Tabcorp a close second after including retail venues.