A News Agent and a Publican walk into a bar

A News Agent and a Publican walk into a bar….

Context:

My imaginary target audience is News Agent National Association members, and the medium is an online newsletter to members. The message is to lobby for gaming machine licenses, and the goal is a call to action to members to give their feedback on this proposal (via a survey). My role is the advocate for this idea. This idea is for NSW in Australia, where poker machines are legal in any pub, club or hotel.

Please note the ideas in this blog post are not endorsed by me, it’s a future thinking exercise.

The Proposal:

Australia’s 3,800 News Agencies have been suffering greatly in recent times, and their future continues to look dark.

As our members know too well,  turnover is forecast to continue to decline 3% annually, driven largely by consumption of free digital media, but also the decline in instant lottery sales, which represents one quarter of News Agencies $2bn turnover.

The other enormous problem that our members face is that news agencies exclusive rights to sell scratchies in Australia expired on 31 March 2018 (after being extended for 5 years), and super markets are desperate to move in on instant lottery sales.

News agencies still have not diversified and seem at a loss to resolve this problem.

For inspiration, News Agencies, the National Association and the Media companies who rely on our member network should look at Gaming Machines.

Gaming Machines have been the source of the decline in instant lottery turnover, as gamblers turn in droves to gaming machines in pubs and clubs since deregulation in the early nineties.

Gaming machines are now widely distributed (except for WA), present in 3,000 licensed pubs and clubs (75% of total), and there are almost 200k machines, with half of them located in NSW (Figure 1) in these venues.

Figure 1  The proliferation of Gaming Machines in Clubs and Pubs in 2015/2016

Subsequently, Gaming machine turnover has increased 600%, from $23 bn in 1990/91 to $143bn in 2015/16 (Figure 2) .

Figure 2 Explosion in turnover of Gaming Machines in Clubs and Pubs

For pubs across Australia, this has meant a reversal in fortunes for the publican. Each machine is estimated to make over $100k annually for the pub owner.

If News Agencies were given the license to have poker machines on premises, they could double State revenue assuming another 200k machines could be installed in their base of 3,800 outlets, and provide a future revenue stream that will support their business well beyond what instant lotteries and newspapers could do.

Figure 2 Newsagency of the future

The National Association of News Agencies are polling our members to assess the level of support for this future direction of News Agencies.  Once we have gathered the facts, we will lobby both media companies and Government as your representative body for the legislative change to make this happen.

Please complete the survey HERE to give your view on this vital issue by 15 June 2018.

My data is from the Australian Gambling Statistics 1990–91 to 2015–16, 33rd edition which is a survey conducted annually by the Queensland Government.  The data comes in excel format, ready to use.  I augmented this with data on the number of gaming machines in each state, combined with the Australian Government Productivity Commission’s Inquiry into Gambling from 2010.

Some definitions:
Gaming machines: All jurisdictions, except Western Australia, have
a state–wide gaming machine (poker machine) network operating in clubs and/or hotels. (WA only has machines in the Crown Casino, 1,750 of them). The data reported under this heading do not include gaming machine data from casinos. Gaming machines accurately record the amount of wagers played on the machines. So turnover is an actual figure for each jurisdiction. In most jurisdictions operators must return at least 85 per cent of wagers to players as winnings, either by cash or a mixture of cash and product.
Instant lottery: Commonly known as ‘scratchies’, where a player scratches a coating off the ticket to identify whether the ticket is a winner. Prizes in the instant lottery are paid on a set return to player and are based on the number of  tickets in a set, the cost to purchase the tickets, and a set percentage retained by  the operator for costs.
Expenditure (gross profit): These figures relate to the net amount lost or, in other words, the amount wagered less the amount won, by people who gamble.  Conversely, by definition, it is the gross profit (or gross winnings) due to the operators of each particular form of gambling.

Join the Conversation

4 Comments

  1. Hi Tracy.

    Interesting story and very confronting to read given that it takes such a polarised view. I like how you have stuck to the focus and the call to action. Well done.

    Some points to consider.

    * Numbers I find are easier to read if they are broken up using commas. For example – “Australia’s 3800 News” I find easier to read as “Australia’s 3,800 News”
    * I found it difficult to read the figure in Tas, could it be put next to the state?
    * Fig is difficult to read, could you change the starting point of the x-axis? I also got confused by the y-axis as the most recent time is at the top. Time usually runs left to right but in this case, I feel it should run top to bottom. There seem to be faint grey lines in the chart. Are they required? And finally, the bottom number seems to be slightly high so it blends with the bar above.
    Perhaps the key message bar could be a different colour to draw attention to it and the others are grey.
    * As a general rule, I tend to put titles on all charts in case they are lifted and taken out of context. It also helps if the title contains the key message that the chart is showing.
    * Missing spaces “casinos.Gaming”
    * Unneeded return character “Prizes in
    the instant”
    * “lost or, in
    other words”

    Like

    1. Thanks Rory, I have made changes from your comments, cheers! I completely swapped out that other graph.

      Like

  2. Hey Tracy,

    This is scary kind of diversification on the part of News Agents and what looks to be also convenience stores?

    I really like the map – I wonder whether WA has similar problems proportional to population size.

    My main point of improvement would be on Figure 2 – is there another way you could describe the proportions in order to increase the size of the graph? I almost missed it.

    Like

    1. Thanks Corinna. I will make the note that WA has no poker machines other than the 1,750 in the Crown Casino.
      Yeah I know, its a terrible graph. Will just put it in excel. I have done something weird to my numbers and I couldnt get it to behave in tableau!

      Like

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