In a world of declining ad sales, media outlets have grabbed for a share of the only real growth area in advertiser spending: gambling.

Last night’s Media Watch noted the massive growth in gambling ads in recent years in the Australian media. Gambling companies have gone from spending $96 million in 2011 to $236 million in 2015. That money is fuelling the revenues of media companies, which are in turn upping their exposure to the industry through investments in all types of betting directly. But the societal cost is that the more money consumers lose on gambling, the less they spend in other areas. That is in turn hitting media companies through lower ad sales elsewhere. Australians lose $23 billion a year on gambling, with much of that coming from poker machines. Media companies all wash their hands of poker machines and say they have the situation under control. They don’t; they are desperate, revenue-poor companies chasing a greater share of the only real growth area in advertising.

Media Watch could have noted the expansion of gambling at News Corp — Crikey yesterday pointing out News Corp’s undeclared financial interest in greyhound racing, amid a vehement campaign against the greyhound racing ban imposed (and this morning dropped) by the Baird Liberal government in New South Wales.

News Corp’s exposure to gambling is global — The Sun in the UK has an online gambling operation in partnership with Australia’s Tabcorp. All News Corp papers run fantasy football competitions, such as The New York Post. The tabloids in Australia, led by the Herald Sun in Melbourne and Sydney’s Daily Telegraph, also run fantasy football competitions, which are a form of gambling.

It’s not News Corp’s only investment in the sector. Among the AFL grand final ads on Seven was one for a new fantasy football business in which the supposedly family-friendly Seven Network will get into bed with CrownBet and the News Corp-owned Fox Sports in the existing fantasy football competition called Draftstars, currently owned by CrownBet and Fox Sports. An announcement from Seven last month said:

“Seven West Media … today announced its investment in Draftstars, Australia’s leading daily fantasy start-up. Draftstars is a joint venture between Seven West Media, CrownBet and Fox Sports, and is the official daily fantasy sports partner of the Australian Football League. Seven West Media has secured a 33 per cent shareholding and will provide media support, product development and investment to further drive brand awareness and usage in an integrated media campaign across all Seven’s leading content brands.”

That release quoted Tim Worner, the CEO of Seven West Media, saying:

“We are delighted to partner with CrownBet and FoxSports in Draftstars. Our investment builds on our strategy of leveraging the power of our media assets to scale early stage businesses. Draftstars is an exciting investment for our company and we look forward to working with them and our investment partners in driving brand awareness and engagement.”

Which can be contrasted with Worner’s comments reported last night by Media Watch on the issue of gambling ads:

”I have children myself and I am not blind to the concerns … We already have extensive restrictions in place to ensure community standards are met.”

Restrictions are in place for ads from the likes of CrownBet, Sportsbet and William Hill. But Seven says it will be offering to  “provide media support” through “an integrated media campaign across all Seven’s leading content brands”. That sounds like flogging Draftstars to as big an audience as possible, including children through every channel and brand.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey

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