TRACKDATA

The arrangement is anticipated to add tens of millions of dollars to The TOTE’s annual turnover.

TOTE Tasmania Chief Executive Officer Craig Coleman said the increased turnover would ultimately benefit the Racing Industry through increased returns from 2009/10.

Mr Coleman said under the agency agreement, Betfair’s customers would be given the opportunity to bet on The TOTE products.

“When you add this to TOTE Tasmania’s own plans for growth, the additional funding will help to secure the future of what is already a strong and vibrant Tasmanian racing.”

Mr Coleman said TOTE Tasmania and Betfair shared the view that the new relationship was a logical step for the national industry to offer wagering services to a new set of international customers.

“It is worth noting that Tasmania is the only jurisdiction in Australia whose licensed wagering companies are allowed to advertise in the

,” he said.

“Betfair already has more than one million registered customers in the

which it can market Australian racing to immediately.”

“We’ve always maintained that Betfair’s exchange products complement those of the traditional operators,” said Betfair Chief Executive Officer, Anthony Klok.

“This agreement enables us to leverage our technology and online distribution expertise to better meet the needs of our customers,” he said.

Betfair customers will now have the convenience of being able to bet on a broader range of products from their existing Betfair account.

1. Who is Tote Tasmania?

Tote Tasmania is the licensed totalisator in Tasmania. Tote Tasmania is a participant in the SuperTAB pool.

2. When will customers be able to start betting on Tote products?

At this stage we expect the service to launch towards the end of next month. As development work nears completion, we will provide launch updates on our homepage.

3. How will Betfair customers go about placing bets on Tote Tasmania’s products?

Customers will log in to Betfair and navigate to a page on the Betfair site that offers a live interface to a specially-developed Tote Tasmania interface. From there, they will be able to place bets using funds held in their Betfair account.

4. Will customers receive the Tote Tasmania (SuperTAB) dividends?

Yes. The dividends customers receive will be the same as those that would have been received had the bet been placed directly with Tote Tasmania or any of the other SuperTAB operators.

5. Will Betfair charge commission on customers’ winnings on bets placed on Tote Tasmania products?

No.

6. Do customers have to open up a new account to bet on Tote products?

No. Customers will be able to bet on the Tote products if they have already satisfied Betfair’s account-opening requirements, including relevant age and identity verification processes (e.g. the 100-point check).

7. Why does Betfair want to offer Tote/TAB products to its customers?

We have always maintained that our betting exchange was complementary to the products offered by the Tote/TABs. This arrangement helps us move towards being a ”one stop shop” for internet wagering. We think the convenience of being able to bet on the full suite of Tote and exchange products from a single account will be attractive to many of our racing customers.

8. Does this mean Betfair now has a tote/TAB licence?

No. Betfair does not require a tote/TAB licence because it is not operating its own tote/TAB. It is simply acting as an agent for Tote Tasmania to help distribute the Tote’s existing products.

9. How many customers does Betfair have?

Betfair has more than 1.1 million active customers worldwide. Approximately 15,000 of those customers are in Australia.

10. How will this deal help the racing industry?

Whenever any of our customers – whether they live in Australia or overseas – bet on Tote Tasmania’s products, revenue will be generated for Tote Tasmania to help support the racing industry.

11. How are taxes and returns to the industry (e.g. product fees) calculated on revenue generated through Betfair’s customers betting on Tote Tasmania’s products?

For the purposes of calculating taxes and product fees to the industry, revenue generated through the arrangement is treated in exactly the same way as if the bets were placed directly with Tote Tasmania.

12. Will Betfair make any money out of this arrangement?

Yes. Betfair will receive a share of net revenue for acting as Tote Tasmania’s agent. The commercial details of the arrangement are confidential.

13. Will Betfair be promoting the Tote’s products to its overseas customers?

Yes. Betfair already promotes Australian racing to its overseas customers. Approximately 25% of all customers betting on Australian racing are from overseas. Tasmania is the only jurisdiction in Australia whose licensed wagering operators (such as Betfair) are able to advertise in the UK.

14. Is the agreement exclusive?

From Betfair’s perspective the agency agreement is exclusive insofar as other Australian participants in the SuperTAB pool are concerned. However, there is nothing stopping Betfair entering into similar agreements with operators of other TAB pools here and overseas. For example, Betfair already has a similar agreement in place with the UK Tote.

15. Does the agreement allow Tote Tasmania to offer Betfair markets on its site?

No. The agreement relates solely to Betfair acting as the Tote’s agent for the purpose of helping to distribute the Tote’s products.

16. Is it legal for people to bet with Betfair (on either the exchange or the Tote products) throughout Australia?

Yes. Punters in every State of Australia are legally permitted to bet with Betfair on both its exchange products and any Tote products it offers on Tote Tasmania’s behalf.

17. Does this agreement mean that Betfair is losing interest in its betting exchange in Australia?

Definitely not. We have always said that our betting exchange complements the products offered by the Tote/TABs and this agreement represents our faith in that proposition. Betfair’s betting exchange is currently growing at approximately 30% - even without the ability to advertise throughout mainland Australia. We see this arrangement as a step towards our aim of offering a full suite of wagering products to our customers through a more convenient and robust technical interface.

18. What gaps will the arrangement fill in Betfair’s existing product offering?

The arrangement will mean that our customers can bet on exotic products (e.g. trifectas and quinellas) from their existing Betfair accounts. Betfair’s exchange isn’t really suited to offering exotic products so this meets an existing customer need that we aren’t equipped to address through the exchange. In addition, it will put our customers in a better position to place their win/place bets through the exchange or the Tote – depending on where they see the opportunity.

19. What products offered by Tote Tasmania will be available to Betfair customers?

a. Win and Place

b. Quinellas

c. Exactas

d. Trifectas

e. Doubles

f. Quadrellas

20. Who is bearing the costs associated with the arrangement?

The cost associated with development of the interface and its promotion to customers is being borne by Betfair. The arrangement carries no financial risk to Tote Tasmania.

21. Is the agency arrangement a step towards Betfair acquiring Tote Tasmania?

No. As far as we know, Tote Tasmania isn’t for sale.

22. Does this agreement represent a step towards Betfair looking to bid for the wagering licence in Victoria?

No. Betfair currently has no plans to bid for the Victorian wagering licence.

23. Does Betfair need separate approval from interstate racing bodies to offer Tote bets on their races?

No. Betfair is simply acting as a distribution agent of Tote Tasmania. To the extent Tote Tasmania has approval to offer bets on certain races, Betfair is also able to facilitate bets on relevant Tote markets.

24. Will racing stewards and regulators have access to details of bets placed through the Betfair Tote interface?

Yes.

25. Will bets placed on Tote products affect commission paid on exchange bets?

No. Bets placed on Tote products will be quarantined from a commission perspective. That is, customers will not pay commission on winning Tote bets but any losing Tote bets will not be used to offset winning bets on corresponding exchange markets.

26. Will bets placed on Tote products accrue Betfair Points?

Yes. Details will be advised to customers prior to launch.

PRESS RELEASE 07/04/08 03.00PM