David Holdgate, Chief Executive, SIS. To the Betting Shop Show 2001:

Good afternoon, gentlemen.

There's a lot of pie in the sky and, for that matter, a lot of Sky in the pie being punted about just at the moment.

Very carefully worded announcements are being placed suggesting that there is a competitor out there ready to supply you with a service. But with only a cursory glance at the details you can see that all that is being said is that Sky are making available their digital platform on a commercial basis. There's nothing new there - we have already explored the Astra delivery option and dismissed it.

But it seems you can't go anywhere without hearing about another potential challenger who'll provide a cheaper service, a wider service, a deeper service - and all with a dozen different pricing options.

Nowhere is there any evidence of a programme maker putting together any kind of service to drive the business of the betting shop. The moment half these challengers look at the vast quantities of investment required to deliver a service to you, to the level that your punters have come to expect, they get cold feet.

And all the time, SIS is being attacked for its policies over the past 14 years. Well, we've listened and we've learned and we are prepared to put our cards on the table. We are going to commit substantial investment to make our service a truly 21st century one. We are going to lower our prices and we are going to give you more for your money.

But although this is a new offer for 2002 onward, it is not a fresh start. We already have a superb history of top quality service and unbroken transmission. Since 1987, there have been 27 weeks of UK racing lost - for a variety of reasons. There has never been a day lost of the SIS service. In the 1967 foot and mouth epidemic bookmakers had to close their doors for business. This time SIS kept the industry alive - by supplying South African, French, Italian and Emirates horseracing, plus Greyhounds and Numbers betting. Whoever comes to the market is going to have to supply you with that quality and that unbroken service. We know, and you know, that SIS can and does deliver.

We've also got a history of helping you grow your business. Who else will ensure that your business is as important as theirs? As the video shows, during our 14 years, we have delivered an increased volume of coverage, more races at more meetings, elimination of the bar price, coordination of race times, computer forecasts and tricasts, uninterrupted commentaries, overseas racing, numbers betting and we even proposed changes that improved the SP system. When evening and Sunday opening was first introduced we offered our service on an optional basis, allowing customers the choice of opening or not while they assessed the market Last year alone, in response to requests from our customers, we added more Irish product and increased the coverage of BAGS meetings by over 70%. These products have proved very popular with punters and they form the bedrock of our continuing services to the betting industry.

So, that is the history of SIS - more and more quality products, delivered to an ever higher standard and protected from piracy.

What about the future? It's all about technology and content.

You need equipment that:

- can be tailored to your needs

- is totally compatible with all the text and EPOS equipment already installed and has an encryption system that will not be broken.

- is of uncompromising quality - able to stand up to the weather and your business environment - from the downlink equipment through to the receivers

- provides sufficiently high quality video bandwidth to produce pictures during high speed movement.

- is future-proofed to ensure expansion to TCP/IP data applications without disruption.

SIS can guarantee that our offer is all that - and more.

You also need a totally modern, digital, solution. There are real and serious problems associated with ensuring continuity of a quality service. Let nobody convince you that they can, in some way, circumvent these problems. They present SIS with a serious challenge in terms of timescale and, therefore, an even greater problem for potential replacement suppliers.

We have commenced a digital rollout to re-equip the transmission and receiver equipment throughout the estate of 9,300 shops. This will involve a capital expenditure programme of more than £25million over the next 2 years.

We will replace and upgrade production and transmission facilities at SIS to improve the range and quality of the service we supply. We will move transmission to a different, digital, satellite transponder. We will replace the dish and receiver in each shop.

And this is where the problem arises. In order to ensure that there is a continuity of the shop service from May 2002 onwards, the replacement programme needs to be started now! We have agreement to the rollout programme from a number of shops, but cannot proceed with any shops where we have no agreement.

With an estimated time-scale of 15 months to complete the process, SIS would need to be running a dual service past the end of the current contract period. With the number of shops currently signing up for the digital transfer, we are not in a position to extend our current satellite lease indefinitely. At some point during next year we will switch of our analogue service.

It is hard to imagine an alternative provider being able to deliver to all shops without a break in service, even if they were to start installing equipment today. To put up a second satellite dish on any premises, without removal of the existing dish, requires planning permission and, in many cases, landlord's consent. This is a time-consuming process of some months. Our existing dishes cannot be removed before 30 April, without a loss of service until that date.

With SIS, the risk inherent in change is eliminated. We use tried and tested technology and we know exactly what we are about. We have the people, the expertise and resources to deliver the modernisation I have set out.

Now, I'll bet you're all sitting there thinking that this sounds expensive. It is not. . In fact, we are offering more product within the integrated service than ever before. And we are effectively reducing our existing price.

Let's deal first with what you and your punters will get if you accept our offer. I want to be quite clear at this point. Only our offer includes:

• Exclusive BAGS Greyhound racing.
• Exclusive coverage from the ten UK racecourses that are part of the GG Media deal
• Exclusive Irish Horseracing
• Exclusive South African Horseracing
• Exclusive numbers betting

Nobody else can, or will, be able to supply this product. The product that, as you all know, provides over 30% of your turnover and a significantly higher proportion of your profits. They are the subject of long-term rights deals extending beyond l 2002. Whatever happens with UK racing, we - and we alone - will be offering you those products.

As to rest of the service, there will of course be pictures and commentary from the 49 non-GG Media courses and BHB data from all 59 courses, subject to the BHB granting the appropriate licences.

You will be able to receive the full service Mondays to Saturdays throughout the year, plus Sundays for the UK summer season, and evenings for the UK summer evening season.

And what about the price of all this?
We are effectively reducing our price by £1490 a year. That's a cut of almost 23%.

You can choose between two options:

The first is for a five-year contract where the price is £5000 per shop, per year, excluding V.A.T., held at that level for the first two years of the contract, and then subject to RPI changes in years 3 to 5.

The other option is for a two-year contract where the price is £5250 per shop, per year, excluding V.A.T., held at that level for each of the two years. Customers would have the option of extending this contract for three more years, with the price being subject to RPI changes for years 3 to 5.

Remember that both these options now include the cost of UK evening and summer Sunday racing -for which you currently pay £610.

If the BHB do not grant you, or us a licence to use British racing from their 49 courses we will further reduce our price by £500 per shop.

As I said at the beginning - we have listened to you - our customers and I believe we have put together an offer that it would be difficult to beat. Even if one of these mythical 'better and cheaper' challengers, of which there is no sign, were to appear.

We are giving the guarantees of service, quality and continuity that you need. We must all stay at the leading edge of providing the best experience there is. That is only possible if deals are done now - with people of experience, expertise and financial commitment.

There are other companies around with experience of sports broadcasting; even racing broadcasting. There are other businesses which are expert in information gathering and transmission. But no other supplier has the infrastructure, personnel, experience and expertise - in place now - to provide you with the services you need today. No other supplier has committed the investment needed to replace the SIS equipment presently installed at your premises.

SIS limits your risk. Leave the gambling to your customers. Join us today.

click here for the offer letter to bookmakers.
click here for the acceptance letter to bookmakers.