What Is a Bookmaker? How Betting Works and the TAB NZ Rule

A bookmaker is a company that offers sports betting, which lets you bet on the results of sporting events. Because you can follow and support your favourite teams and players while you bet, sports betting is popular around the world.

What You Will Learn

• A bookmaker is the operator that takes sports bets and acts as the house.
• You can bet money on your predictions for the results of rugby, cricket, football (soccer) and other sporting events.
• The payout percentage (the share of all stakes paid back to punters) is generally put at about 90–98%, higher than that of lotteries and tote (pari-mutuel) horse racing.

This article takes about 13 minutes to read.

What Is a Bookmaker? The House Behind Sports Betting, with More Than 200 Years of History

A bookmaker (or, in everyday speech, a bookie) is a company that lets you bet on the results of sporting events around the world, such as which team will win. Placing these bets is known as sports betting.

Bookmaking has a long history that goes back to 18th-century Britain, and betting shops run by bookmakers can still be found across Europe today.

Bookmaking Took Hold in Britain in the 1790s

Bookmaking is generally traced to the 1790s, more than 200 years ago, when Harry Ogden began offering odds on racehorses and taking bets at Newmarket Racecourse in England, home of races such as the 1,000 Guineas and the 2,000 Guineas.

At first there was opposition, with some arguing that the practice did not fit the traditions of horse racing. Bookmaking gradually became very popular, however, and in 1961 betting shops were legalised.

For this reason, Britain is often described as the home of sports betting, and the sports industry and bookmakers remain closely linked there today.

William Hill and Ladbrokes: Britain’s Oldest Bookmakers Move Online

William Hill is one of Britain’s best-known bookmakers. Founded in 1934, it opened betting shops in many locations after they were legalised in 1961, allowing customers to place sports bets in person. In recent years it has closed and consolidated many shops, and the focus of its business has shifted online.

Ladbrokes, another of Britain’s best-known bookmakers, is even older. It was founded in 1886 as a commission agent for racehorses trained at Ladbroke Hall in Warwickshire, and it also grew into a large chain of betting shops after they were legalised in 1961. Ladbrokes merged with Coral in 2016 to form Ladbrokes Coral, which was acquired in 2018 by GVC Holdings (renamed Entain in 2020). Like William Hill, it now does much of its business online.

William Hill launched its online betting business in 1998, allowing customers to bet over the internet without visiting a shop. The world’s first online casino opened in 1996, so online casinos and online sports betting started at almost the same time.

What Makes Bookmakers Appealing

One feature of bookmakers is that your knowledge of the sport you bet on can inform your decisions. For this reason, some punters feel they can make better use of their own judgement than at an online casino.

Set a Budget Before You Bet

Whatever appeals to you about betting, the first step is the same: before you place your first bet, decide how much money you can afford to lose, and treat that amount as the cost of entertainment rather than as a way to make money. Once the budget is used up, stop betting for that period.

While you are still learning how odds and markets work, keep your stakes small. If you lose, never try to win the money back by betting more. Chasing losses is one of the quickest ways for betting to stop being enjoyable.

Higher Payout Percentage Than Lotteries and Pari-Mutuel (Tote) Horse Racing

The payout percentage is the share of the amount bet that is paid back on average. It is the flip side of the bookmaker’s margin, which is the share the bookmaker keeps.

The bookmaker payout percentage is generally about 90–98%, depending on the market. Put another way, the bookmaker’s margin is 2–10%, and the rest is paid back, on average, to punters as a whole. Because there is a margin, however, betting at random over the long run still leads to a net loss. Because online betting does not require physical shops, operators have lower overheads, which is said to be one reason the payout percentage can be this high.

Odds Are Locked In When You Place Your Bet

Your knowledge can inform your decisions because at a bookmaker, the odds are fixed the moment you place your bet.

In tote betting, as used in horse racing, the odds are not set when you buy your ticket. They become final only when betting closes. This system is designed so that the house is unlikely to lose money, and punters face a built-in cost equal to the tote operator’s deduction.

Bookmakers, by contrast, use fixed odds (fixed-odds betting). The bookmaker sets the odds first, punters place their bets knowing those odds, and the odds are locked in the moment the bet is placed.

Because the odds are known in advance, a punter who knows the Premier League well, for example, can look at the odds for its matches and judge whether a price looks like good value. Fixed odds do not in themselves give you an edge, however.

Most bookmakers can be used from a smartphone, which makes betting convenient for punters who know a particular sport well.

Bet on Events Beyond Sports, Such as Elections

If you are interested in betting but do not watch many sports, specials (novelty bets, sometimes called prop bets) are a good option. Many bookmakers let you bet not only on sports but on a wide range of future events.

Markets range from questions such as “Who will win Best Director at next year’s Academy Awards?” to topics of wider public interest such as “Which party will lead the next government after the New Zealand general election?” During the 2020 US presidential election, the odds on whether Joe Biden or Donald Trump would win were widely reported in the news. You can therefore bet on entertainment, politics and other areas even if you know little about sports.

The range of sports is also wide. Besides major sports such as rugby, cricket, football, baseball and basketball, you can bet on individual sports such as boxing and tennis, darts and other indoor sports, and, more recently, esports titles such as Counter-Strike and Call of Duty.

Watch Matches Live with Live Streaming

With money on the line, it is natural to want to watch the match as it happens, and many bookmakers stream live sport to account holders.

You are not limited to the matches you have bet on, though some bookmakers require a deposit or a bet before you can watch. Which matches are streamed, the conditions for watching and the regions where streams are available vary by bookmaker, so check what is offered before relying on streaming.

Matches Available via Live Streaming

Rugby

Super Rugby and more

Football

The Premier League, Serie A, La Liga, the Bundesliga, the Champions League, the World Cup and more

Baseball

MLB (Major League Baseball)

Tennis

The Australian Open, the US Open, the French Open, Wimbledon and some tour events

Cricket, netball and horse racing may also be available, as well as basketball, American football, table tennis, ice hockey, futsal and other sports. Coverage varies by bookmaker and competition, so check the details with the operator.

How to Get Started at a Bookmaker

The steps below describe how betting accounts generally work: once you have registered with the operator and made a deposit, you can start betting right away. For people in New Zealand, racing and sports betting is offered only by TAB NZ.

Start by Signing Up with a Bookmaker

The first step is to register. Go to the operator’s website or app, enter the required information and create an account. There are only a few fields to fill in, so registering usually takes about 10 minutes.

The law in New Zealand is clear about who may take your bet: since 28 June 2025, no one other than TAB NZ may offer racing or sports betting to a person in New Zealand, and this applies wherever the operator is based (Racing Industry Act 2020, section 74AAA). You must be 18 or over to bet with the TAB. Bookmakers in other countries are licensed by their own national or regional regulators (see “Bookmakers Need a Licence to Operate” below).

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Documents You Need After Signing Up

Online gambling sites, including bookmakers, usually require identity verification (KYC) before your first withdrawal.

Identity verification is the process in which you submit documents so that the bookmaker can confirm that the name, address and other details you entered when creating your account are correct. It is carried out to prevent misuse such as money laundering. Many operators require it, but the timing varies by operator.

You will mainly need two documents: a photo ID, such as a passport or driver licence (or, in some countries, a national ID card), and proof of address, such as a recent utility bill or bank statement. You may also be asked for proof of the payment method you used for deposits and withdrawals, such as a photo of your bank card or a screenshot of your bank account. Documents are submitted through an upload page on the site.

In many cases you can complete verification as soon as your account is created, so if you do not want to wait for your first withdrawal, it is a good idea to finish verification when you sign up.

Ways to Bet at a Bookmaker

1X2 / Head-to-Head

The basic bet on who will win, with no line or other adjustment. In sports with draws, such as football, it is usually offered as a three-way choice of home win, draw or away win (a 1X2 bet). In sports without draws, such as tennis, it is usually offered as a two-way head-to-head bet.

Line

A bet on which team will win after a start (a handicap of points or goals) has been applied to one of the teams. Line betting is known as the point spread in US sports. The line can be applied to either team.

With a standard three-way line, if the result is a draw once the line is applied, the stake is not returned. With Asian handicap lines that use whole numbers, however, the stake is refunded (with quarter lines such as 0.25 or 0.75, half the stake may be refunded).

Over/Under (Totals)

A bet on whether the combined score of both teams will be higher (over) or lower (under) than a total set in advance. For example, an over 2.5 bet wins if the two teams score a combined 3 or more.

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Basic Bookmaker Terms

These are the basic terms worth learning first.

Odds

The multiplier used to calculate your payout when a bet wins. All odds in this article are decimal odds, the standard format in New Zealand, and they include the stake. For example, if you bet NZ$10 at odds of 6.00 and win, you receive $10 × 6 = $60, including your stake, so your profit is $50.

Cash Out

A feature, used mainly in live betting, that lets you settle a bet before the event ends, either to lock in a profit when the bet is going your way or to limit your loss when it is not.

Multi

A multi combines several selections into a single bet. If any one of the selections loses, the whole bet loses. The same bet is called a parlay in the US and an accumulator in the UK.

Fixed Odds

Odds that apply from the moment you place your bet, so later changes in the odds do not affect your payout. Bookmaker odds are fixed in this way.

Market

A general term for the types of bets a bookmaker offers. For a football match, for example, the markets include the match result, line and over/under.

Live Betting

Betting on a match that is already in progress, also called in-play betting. The odds change as the match unfolds.

Are Bookmakers Safe?

Some punters worry that betting online will expose them to fraud. In New Zealand the position is straightforward: gambling is regulated by the Department of Internal Affairs (DIA), and, as noted above, only TAB NZ may take racing and sports bets from people in New Zealand, and you must be 18 or over to bet with the TAB. The sections below explain how licensing works for bookmakers elsewhere.

Bookmakers Need a Licence to Operate

In countries that license sports betting, a company must obtain and maintain a licence from a national or regional regulator to operate as an online bookmaker. A licence is a permit that authorises the company to operate as a bookmaker under the rules set by that regulator.

Before a licence is granted, the applicant is audited against strict standards, such as compliance with the relevant laws and having enough funds to cover payments to customers. A licence is issued only once these standards are met.

A licence is not held permanently once it has been granted. Licensees are audited on an ongoing basis, and a licence can be revoked if a breach of the rules is found. A licensed bookmaker is therefore an operator that meets the issuing jurisdiction’s standards and is under its supervision.

Many Bookmakers Sponsor Sports Teams and Events

Many bookmakers are large businesses, and some of them sponsor sports teams.

For example, long-established British bookmakers have served as official betting partners of Premier League clubs. A company that operates publicly under its own name is easier to check, which is one sign that it is a genuine business.

What to Watch Out For When Using a Bookmaker

Bookmakers operate under their own terms and conditions. If a punter breaks those terms, the bookmaker may withhold winnings and, in the worst case, suspend or close the account.

Read the Terms Before You Bet

Every bookmaker sets its own betting terms, and they apply to every bet you place.

The terms cover things such as maximum winnings, how void bets and cash out are settled, and account verification. For example, they explain what happens to a bet when a match is abandoned or postponed, and what details you must confirm before you can withdraw.

The details vary, so always read the full terms and conditions on the bookmaker’s website before you bet.

Beware of Scams Selling Tools and Betting Systems

Interest in bookmakers rises with every major sporting event. Many people bet for the first time at these moments, and some scams target these beginners.

Some individuals and groups try to take your money by selling betting systems or tools that do not work, such as a “guaranteed profit” betting system or a “tool that raises your expected value.”

Legitimate betting communities exist too. A group whose members simply share tips or report their own results is not a problem. Some organisations, however, use such communities as a front to take people’s money, so be careful.

This applies especially to communities that recruit on social media. Before joining, check whether they ask for a membership fee or for you to buy a product, whether they back up their claimed winning record, and whether the people running them can be identified.

Arbitrage Betting Is Prohibited at Many Bookmakers

Arbitrage betting (sure bets) is a technique that uses differences in odds between bookmakers to bet on more than one outcome of the same match. In theory, it avoids a loss whatever the result, but in practice many bookmakers prohibit it in their terms.

Suppose, for a simplified example that would not occur in practice, that two football teams, A and B, are playing. Bookmaker X offers odds of “A: 1.50, B: 2.50” and Bookmaker Y offers “A: 2.50, B: 1.50.” If you bet on B with Bookmaker X and on A with Bookmaker Y, in theory you would come out ahead whichever team wins.

This kind of arbitrage may look effective, but many bookmakers ban it in their terms and conditions. It is often detected through monitoring of odds and betting histories, and if it is discovered, it can lead to account restrictions or refused withdrawals. Avoid arbitrage betting.

Finally, whatever markets or methods you use, if betting stops being fun, or you are spending more time or money than you planned, help is available. The Gambling Helpline on 0800 654 655 is free, confidential and open 24 hours a day, 7 days a week, or you can free text 8006.

Summary: Payout Percentages Are High, but Betting at Random Still Loses to the Margin Over Time

Sports betting lets you predict the results of sporting events held around the world. In New Zealand, racing and sports betting is offered only by TAB NZ, and bookmakers elsewhere in the world work in the same way, setting fixed odds with a margin built in.

Online bookmakers in particular have a higher payout percentage than lotteries and pari-mutuel (tote) horse racing, and they let you bet on a wide range of sports, from major sports such as rugby, cricket and football to indoor sports and esports. Bookmakers still build a margin into their odds, however, so if you keep betting without any analysis, you can expect to lose money over the long run.

Simply predicting which team will win is enjoyable enough on its own, so sports betting is easy to get into, even if you have never bet before.