IAGR Conference 2014 Philadelphia
October 2014
Horserace betting in France
Legal framework

Pari mutuel is the only legal form of betting on horseracing in France.

Between 1881 and 2010, only horse racing associations (nonprofit) were
allowed to organize betting on horseracing :


–
On racetracks only until 1931,
–
Off-track since 1931, through PMU.
In 2010, the law opened the French online gambling market (horserace
betting, sports betting and poker) to competition :
–
Horseracing associations keep the monopoly for on-track betting and, though PMU, betting in
retail networks,
–
8 operators (including PMU) offer online betting on horse racing.
Offline and online gambling markets are now regulated by different laws and
monitored by supervision bodies, of which ARJEL regulates online gambling.
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Horserace betting in France
The market
In 2013, horserace betting accounted for :
 € 9.93 billion handle
 23% of total gambling expenditures in France in 2013
1%
2%
97%
French Gambling Market per Gambling Offer in 2013 (handle)
PMU (horserace only)
15%
PMH
23%
Online licensed
operators
Horserace Betting
Sports Betting
Lotteries
5%
Offline Casinos (estimate)
Online Poker
33%
24%
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PMU, a company created to fund racing

Created in 1930 by French Horseracing Associations, PMU is a leisure
company whose role is to conceive, market, totalize and promote bets
on horse races for their account.

Since 1985, PMU has been an Economic Interest Group (EIG), now
made up of 58 horseracing associations
o Diversified into online sports betting and poker in 2010
o Returns its whole profit to its members

→
PMU is run by a Board of Directors which gathers :
o
PMU’s Chairman & CEO and PMU’s Managing Director,
o
4 representatives from State Departments (2 for
Finance and 2 for Agriculture)
o
4 representatives of the Horseracing Authorities (2 for
France Galop and 2 for SECF).
PMU’s activity is closely supervised by the State
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PMU net income / return to the industry (M€)
876
865
854
791
736
727
731
694
668
614
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
5
N°1 Horserace betting operator in Europe
N°2 Horserace betting operator worldwide
€ 10.4 billion handle in 2013
75.7% punters
9.2% State
5.8% PMU’s
operating costs
8.2%
Net profit paid to
horserace…
1.1% foreign
providers
€ 854 million paid to the horseracing sector in 2013
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PMU’s Offer
Horserace betting
o Retail network
o Online on PMU.fr
o Abroad in common pool
Sports betting
o
Online on PMU.fr
Poker
o
Online on PMU.fr
•
•
•
•
€9,6 bn stakes (-1.8%) in 2013
15,371 races in 2013
Export : + 94%
85% market share
•
•
•
•
€199 million stakes (+22.4%)
24% market share
30+ sports
Live betting : 47% of stakes
•
•
•
•
Cashgame et tournaments
€569,9 million stakes (+ 10%)
N°3 operator
9% market share
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Cross selling is key to attract new customers
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PMU’s retail network
12, 200 retail outlets in France and overseas territories
 Mainly in cafés, bars, tobacco shops, restaurants
 Diversification : Newsagent’s, gas stations, local shops… and fully
owned Betting shops (« PMU City »)
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PMU.fr
PMU.fr is the N°1 betting site in France
 44% market share, €1 billion turnover
 N°1 for horserace betting with 83.6% market share (Gross Product)
 35% of sports bets are registered through mobile
 Cash game available 24/7 for poker players
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International activity
French races offered to foreign
punters
Foreign races offered to French
punters to supplement national
racing offer
 2,585 foreign races from 27
countries in 2013
 € 549 million handle (+12%)
 31 contracts for betting on
French races in PMU’s Pool :
€638 million handle in 2013
(+94%)
 Contracts for separate pool
betting in 37 countries (>€ 1 Bn
handle)
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PMU’s international contracts
*
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**
* * **
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*
*
*
*
*
*
*
*
*
*
*
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Common pool
Separate pool
CP & SP
*
Import
*
*
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*
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Digital innovation is at the core of PMU’s activity
PMU.FR website
PMU.FR app
Enhanced user-friendly design
Adapted layout for smartphones, IOS and
Android tablets
INFO.PMU.FR website
MYPMU app
Touch screens
Touch tables
Horse racing information
website for offline bettors
Specially designed app
for offline bettors with
all horse racing
information
Displaying live
information in points
of sale
To learn with the« Play for
fun » option or to bet for
real at PMU events
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Powerful IT solutions
 IT accounts for 40% of PMU’s operating costs
 2500 transactions per second, among which 90% come from
PMU’s 12,200 retail outlets
 50% of turnover comes from bets registered in the last 10
minutes before the start of each race
 EASY Project over 5 years, budget > € 50M
− Reduce the Time to Market from 18 to 9 months to launch
a new bet
− Make it possible to operate 24/7
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Corporate social responsibility
Prevention among the
general public and
customers on internet and
points of sales
Funding of medical
research
Training of PMU’s
employees and retailers
Best practice sharing with
other operators and
dialogue with civil society
stakeholders
15
PMU vision for 2020
People & culture
Retail & outlets
Change into an agile and attractive
organization, turned towards innovation
CAGR : +1 % through new retail formats
Digital
60% of the growth in France
through digital channels
International
10 % of net margin outside France
PMU 2020
Customers
15 % of the French people will be
PMU customers
Offer & products
Competitive positioning on every
authorized segment to become a
reference actor of the gambling
market
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Is horse racing really
a dying business?
Revenue sources of major sports
37
18
25
5
5
5
41
44
22
41
Global Sport
Market
Owners
45
30
European Soccer
Leagues (top 5)
Wagering
65
23
36
38
20
British Rugby
Union
Commercial
NFL (USA)
Broadcasting
Horse Racing
Ticketing
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Competition trend : sports
betting surpasses horse betting in
2014
350,000
CAGR 2013/2017 : 3.3%
300,000
250,000 CAGR 2009/2013 : 5.5%
200,000
150,000
CAGR 2013/2017 : 7.5%
CAGR 2009/2013 : 0.8%
CAGR 2013/2017 : 1.2%
100,000
CAGR 2009/2013 : 4.3%
50,000
0
2007
2008
2009
2010
Horse Racing
2011
2012
2013
Sports Betting
2014
2015
2016
2017
Lotteries
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A broad range of issues to renew
horse racing
Breeding
Wagering
Pattern
racing
Major
events
Industry
vocational
training
Antidoping
Social
media
Jockey &
horse safety
Customer
Big Data
Environmental
sustainibility
Laboratory
accreditation
Integrity
Popular
culture
Media
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 benoit.cornu@pmu.fr
@benoitcornu