The following is from today's Australian newspaper

Racing loses bid to block Betfair
Daniel Hoare
December 10, 2004

CONTROVERSIAL online betting exchange Betfair is expected to gain a permanent Australian wagering licence by mid-2005 after the federal Government refused the racing industry's last-ditch bid to have the company banned from operating here.

With several states expressing an interest in licensing Betfair in the new year, Communications Minister Helen Coonan confirmed the Government would not stand in its way, rejecting the desperate pleas of the racing industry and gaming giant Tabcorp.

The imminent signing of a wagering contract with one of the state or territory governments will set in train Betfair's 50-50 joint venture with Kerry Packer.

Mr Packer's Publishing & Broadcasting Ltd has signed a deal with Betfair which is said to be worth $30 million.

The first state or territory to licence Betfair is likely to see the others follow suit, according to a well-placed source in the Northern Territory Government.

"At the moment it's a case of everyone standing at the edge of the cliff waiting for the first one to jump," the source told The Australian.

"Betfair would provide enormous revenue and none of us would want to see it lost to other states."

Betfair, which has been operating in Britain since June 2000, differs from traditional gambling outfits by allowing punters to bet directly against each other.

It allows punters to back horses to win as well as lose, sparking calls from the racing industry that it would foster corrupt activity. Betfair's British executives have spent the past six months spruiking their internet-based outfit to the state and territory governments. They have received a positive response from all but two jurisdictions - South Australia and Western Australia.

Two of the company's key executives, Mark Davies and Ed Wray, moved to Sydney earlier this year in a bid to lobby for a licence.

While the states have remained coy about their stance on Betfair, well-placed sources have told The Australian the company is likely to gain at least one licence in the new year, possibly in Tasmania.

The Tasmanian Government is believed to have shown a keen interest in licensing Betfair because of its new employment prospects.

A spokesman for Tasmanian Finance Minister Jim Cox - who is responsible for gaming - said the Lennon Government was keeping an open mind on the issue, and had met with Betfair representatives last month.

"We haven't had any formal application from Betfair, but we've left the door open - on the proviso that we get racing industry support," the spokesman said.

Senator Coonan said the federal Government was satisfied its 18-month review of online gambling had not erred in leaving Betfair free to gain a state licence.

"Industry issues, including ... the integrity of the racing industry, are a state-based jurisdiction," she said.

Senator Coonan said it was not the role of the federal Government to "unilaterally move to regulate or protect the racing industry".

The Australian

well it was always inevitable once kerry got involved, will it make any difference to anything? probably not