|Japan racing tracks are suffering from competition from the Internet.|
Cyber bookies offer better odds while guaranteeing the same returns. The disparity is part of a new trend that's putting more and more people in front of their screens to wager rather then seek out their bookmaker or betting shop. Japanese Racing Association officials are at a loss as to how to compete with the new medium, and currently see no way to make up for lost profits.
A JRA official in Tokyo said his jaw dropped when he saw a direct mail from Hong Kong, offering odds on all JRA-organized races that were 10 percent better than theirs.
'We bear the huge cost of raising horses, offering prize money and maintaining racecourses,' said the JRA official. 'We even pay the state 10 percent of our revenue. The Net bookmakers are raking in all they can without bearing any of the cost.'
In Japan, the only legal gambling is on horse racing, motorcycle speedway, boat racing and cycling. JRA calculates that it is losing up to 14 billion yen each year to virtual sportsbooks. The global vaule of online gambling each year is expected to be around 30 trillion yen by 2012.
A National Police Agency official said that if the bookmakers are based in Japan, they can be prosecuted, but when the organization is outside Japan, it is very difficult for Japanese police to intervene.
JRA is eager to form an international network of racing organizations to fight the wired freeloaders and will sign an agreement with the Hong Kong Jockey Club in December to clearly demarcate each other's jurisdiction. It says the Hong Kong Jockey Club is also troubled by the same kind of bookmaking practices.
JRA also wants to ally with racing bodies in the West and is trying to get governments involved to formulate an international agreement to regulate online gambling.
Other countries have tackled the threat online gambling poses to their revenues in different ways. The British government, for example, was forced to give up taxing bets and instead levied a tax on bookies' profits.