Evans does it again

[ponypro]

Open mouth, Insert Hoof

That are all out to protect their 100 million dollar investment

http://news.bloodhorse.com/article/44905.htm


PTC is a far superior business model and my guess ( and this is only a guess) was probably built for less than 100k. It happens over and over again every day some big blowheart CEO with substantial investors capital throws away tens of millions of dollars on their Internet "Vision" then a no nonsense very smart entrepenuer (Ian and co.) build a very economical Internet model that exploits all the corporate blunders of their clueless competitors. Their daily clockers report at Keeneland were bottom line more valuable to the player than the 80 million spent on brisnet. If the idea is treat the customers fairly and help them win, CDI can spend A BILLION more and not get it. Hopefully Evans will be fired before too much longer. He has alienated way too many good folks.

[ponypro]

Remember that 100 million dollar figure because thats why CDI cant negotiate. they are stuck because they bought a pig in a poke.
Only an idiot would publicly brag about an expenditure of this magnitude.
They arent kidding that they cannot give an inch.

But Thats not the Horsemans or the Players problem,

Write it down like every other Corporation that makes a horrendous financial decisions does , get an new CEO and board and let the best ADW win.

[Pace Cap'n]

Evans took a page from television talk show host David Letterman in outlining why ADW is so important to CDI. He offered a top-10 list:


3. The Internet allows racetracks to better understand their customers.

2. The Internet facilities new customer-geared features.

1. The Internet “nationalizes” the relationship between investment and financial return.

Say WHAT?

[NoCal Boy]

I have little use for EVans and his policies, but I believe the word "facilities" should be "facilitates" and "nationalize" should be "rationalize."

No matter what, the THG has his number now. The THG will not get 1/3 of the gross, but they will very likely get open access and more for purses than at present.

[rrbauer]

Evans:
“The only solution is to look for ways to share the upside,” Evans said. “The $15 billion (a year in wagering on Thoroughbred races) needs to be $45 billion for everyone to make an adequate return on capital. Everything else is just rearranging the deck chairs. There’s just not enough money to go around.”


Comment:
What upside? For the one-billionth-time: RACING IS NOT A GROWTH INDUSTRY! Soon these people will be fighting for the scraps under the table.

[Cangamble]

Evans:
“The only solution is to look for ways to share the upside,” Evans said. “The $15 billion (a year in wagering on Thoroughbred races) needs to be $45 billion for everyone to make an adequate return on capital. Everything else is just rearranging the deck chairs. There’s just not enough money to go around.”


Comment:
What upside? For the one-billionth-time: RACING IS NOT A GROWTH INDUSTRY! Soon these people will be fighting for the scraps under the table.
Bob Evans knows it isn't a growth industry. He seems to be focused on strategies of getting every last dollar from the current "suckers" who bet on the game, in a way to make the most profit:
http://www.paceadvantage.com/forum/showthread.php?t=46380

[DJofSD]

Evans:
“The only solution is to look for ways to share the upside,” Evans said. “The $15 billion (a year in wagering on Thoroughbred races) needs to be $45 billion for everyone to make an adequate return on capital. Everything else is just rearranging the deck chairs. There’s just not enough money to go around.”

Richard, my reaction to the above statement is the obvious one (or at least to me it seems obvious): remove all of the damn barriers and handle will increase.

Over the years I have become more selective with my plays. I just don't bet any race because it's there. I want some value for the risk I'm taking, so, I most generally do not even look at a race unless there's 8 betting interests. I rarely bet maiden races. I salivate over grass routes. And if there are too many runners that leave me with nagging little uncertainties, I pass the race.

I will admit, this leaves me with very little races. However, if the number of cards I could bet on were to increase, I'm sure I'd have more targets. Right now with all of the various restrictions, it's a target poor environment.

Would it triple my play, I can't say for certain. But I'd like to give it a try.

[Cangamble]

Richard, my reaction to the above statement is the obvious one (or at least to me it seems obvious): remove all of the damn barriers and handle will increase.

Over the years I have become more selective with my plays. I just don't bet any race because it's there. I want some value for the risk I'm taking, so, I most generally do not even look at a race unless there's 8 betting interests. I rarely bet maiden races. I salivate over grass routes. And if there are too many runners that leave me with nagging little uncertainties, I pass the race.

I will admit, this leaves me with very little races. However, if the number of cards I could bet on were to increase, I'm sure I'd have more targets. Right now with all of the various restrictions, it's a target poor environment.

Would it triple my play, I can't say for certain. But I'd like to give it a try.
If takeouts were reduced by 7% across every track, would your action double or triple? I know mine would.

[njcurveball]

If takeouts were reduced by 7% across every track, would your action double or triple? I know mine would.

Would this be because you are betting more races or betting double or triple on the ones you are already playing?

Serious question, as 7% would certainly not double or triple the action of the normal bettor.

If you are betting $20 to win and you get back $54 instead of $50, does this make you bet $60 in the next race?

[ryesteve]

Would this be because you are betting more races or betting double or triple on the ones you are already playing?

Serious question, as 7% would certainly not double or triple the action of the normal bettor.

If you are betting $20 to win and you get back $54 instead of $50, does this make you bet $60 in the next race?
I don't think so... but I think you'd be churning your money into more races. Lower takeouts allow people to be less selective, same as how rebate players can adjust their action accordingly vs. non-rebate situations.

[Cangamble]

Would this be because you are betting more races or betting double or triple on the ones you are already playing?

Serious question, as 7% would certainly not double or triple the action of the normal bettor.

If you are betting $20 to win and you get back $54 instead of $50, does this make you bet $60 in the next race?
Maybe the average bettor would increase his or her bankroll alloted for horse racing more collectively because they feel they have a chance to win and they may go more often.
Personally, I would probably increase my betting per race as well, but the longevity factor would cause the triple more than the increased betting: I would bet more often on more tracks.

I know this for a fact btw.

[trying2win]

PONYPRO:

I agree with you when you declared that PTC has a far superior business model. Guys like Frank Stronach of MAGNA and Bob Evans of CDI are clueless when it comes to operating and trying to grow their horse racing businesses. When Frankie joined forces with CDI awhile ago (and I'm guessing) that he figured something along the line of..."that'll be a sure bet to bring back black ink to the bottom line for MAGNA tracks".:lol: In my opinion, that's like the old cliche 'going from the frying pan into the fire'!

And about some of Bob Evans comments in that article about "INTERNET AND ADW KEY TO GROWTH'...

“We’re involved in a pretty significant battle with horsemen,” Evans said. “I’m not going to try to explain it, but I do know it makes our business unprofitable.”
Evans called it “wasted time” trying to cut up the share of revenue from wagering that isn’t growing.

“The only solution is to look for ways to share the upside,” Evans said. “The $15 billion (a year in wagering on Thoroughbred races) needs to be $45 billion for everyone to make an adequate return on capital. Everything else is just rearranging the deck chairs. There’s just not enough money to go around.”
Another typical character with a 'poverty consciousness'.

I get a kick out of some of these so-called 'enlightened racetrack executives who hire high-priced 'expert' consultants on how to make their businesses grow.
Ian Meyers of PTC has got it right. He knows that most of the best consultants, are his customers or potential customers. Why? Because they tell him what they want and what they would like to see happen as a customer. And generous cash rebates and superior customer service at PTC are of course, some of the rewards you receive at this stellar ADW. I'm guessing what Frankie S and Bobby E would say about the idea of rewarding cash rebates for bettors for their business...oh yeah...probably that same line that Bobby E said in the paragraph above this one "there's just not enough money to go around". These fellas should follow the advice of Peggy McColl below this line:

~""The Universe wants to give to you. The moment you begin to change your vibration to one of abundance, it will start sending you people, situations, and opportunities that reflect your inner state."


- Peggy McColl

[ezrabrooks]

Would this be because you are betting more races or betting double or triple on the ones you are already playing?

Serious question, as 7% would certainly not double or triple the action of the normal bettor.

If you are betting $20 to win and you get back $54 instead of $50, does this make you bet $60 in the next race?

Interesting take on the lowering of take out. Personally, I wouldn't change my plan of attack at lower takes. A increase in my individual wagers might happen, but not double or triple. I would just take my increased ROI...and be happy. So, if I am a representative player (and well may not be), and the board experts are correct, the increase in handle is going to come from bringing old players back, and creating new ones? This argument just might go the way of ethanol.

[Rook]

Would this be because you are betting more races or betting double or triple on the ones you are already playing?

Serious question, as 7% would certainly not double or triple the action of the normal bettor.


A 7% reduction might not change the action of a "normal" bettor but it would make the action of a close to break even bettor explode. Someone who is in the 92 cent to 99 cent ROI without a rebate is someone who walks away from the game for better opportunities. Give him an extra 7 cents and the .99 to $1.06 ROI is so compelling that he can bet millions a year and even turn professional.

This is not a theoretical argument. There are real world examples.

[Indulto]

... Guys like Frank Stronach of MAGNA and Bob Evans of CDI are clueless when it comes to operating and trying to grow their horse racing businesses. ...We should all be so clueless.

These men may not be friends of horseplayers, but to underestimate their power, intelligence, and ability to pursue their own agendas is what seems clueless to me.

I may poke fun at these two obstacles to my enjoyment of racing, but Evans never says anything he hasn't thought out carefully and hasn't hidden what he is trying to accomplish.

Stronach has amassed more money to be disposed of at his pleasure than anyone else involved in racing. His record as a breeder is "awesome." MEC is his sandbox and he usually gets to do what he wants in it, although it now appears he may allow another synthetic surface to be installed at SA.

It will take a lot of very smart, determined, well-organized, and well-supported players to force these two men to alter their paths. Bitching about them instead of coming up with intelligent suggestions as to how to effect changes to their courses is a waste of time, but I guess that's what we do best here.

[happy1]

hmmmmm seems to me if the THG holds out that the rebating model will be void and fail. Also, forget about lowering the take.


Well not "seems like" its a fact, you can kiss rebating goodby and everyone will need to wager offshore. (kind of hard for a rebator to go from 40% expense to over 70%)

[InsideThePylons-MW]

Interesting take on the lowering of take out. Personally, I wouldn't change my plan of attack at lower takes. A increase in my individual wagers might happen, but not double or triple. I would just take my increased ROI...and be happy. So, if I am a representative player (and well may not be), and the board experts are correct, the increase in handle is going to come from bringing old players back, and creating new ones? This argument just might go the way of ethanol.

Sharp thoughts.

If I was buying 5 c-notes for $100 each, I'm sure if I could buy them for $90, I would still only buy 5.

[sjk]

I don't find the analogy fitting.

Most players are purchasing entertainment (or you would at least hope so because most players are not making money). If you go to the amusement park and can buy 10 rides for $10 would you buy twice as many if they were only $9. Maybe you only want to go on 10 rides.

Perhaps a player finds a $50 bet entertaining but finds that a $100 bet is an unpleasant stressful experience. Most people don't know whether their finanacial expectation is positive even after the reduced takeout. Why do something stressful with an uncertain and unknown outcome?

Even if a player knows he has a positive expectation he probably has a bet level that he is comfortable with. Maybe the extra profit at the end of the day is not meaningful enough to his standard of living to want to turn a pleasant pastime into something beyond his comfort level.

[InsideThePylons-MW]

I don't find the analogy fitting.

Most players are purchasing entertainment (or you would at least hope so because most players are not making money). If you go to the amusement park and can buy 10 rides for $10 would you buy twice as many if they were only $9. Maybe you only want to go on 10 rides.

Perhaps a player finds a $50 bet entertaining but finds that a $100 bet is an unpleasant stressful experience. Most people don't know whether their finanacial expectation is positive even after the reduced takeout. Why do something stressful with an uncertain and unknown outcome?

Even if a player knows he has a positive expectation he probably has a bet level that he is comfortable with. Maybe the extra profit at the end of the day is not meaningful enough to his standard of living to want to turn a pleasant pastime into something beyond his comfort level.

Sure there are players that bet a certain amount and will not change it. If racing counts on these people, it is dead.

Reducing takeout actually gives those with an IQ above 50 the idea that you can beat the game when the rules are explained to them. Therefore, you can at least create new customers that are going elsewhere with their money and time.

If you are a loser, you bet more because your money goes farther.

If you are a small loser, you now bet more because you are now a small winner.

If you are a break even player, you bet more because you are now a good winner.

If you are a winner, you bet more because you are now a big winner.

Once you are a winner you now have much less bankroll pressure so therefore the comfort level automatically rises.

Very hard to bet $1000 on a race when it's your paycheck money, but it's easy to bet $1000 on a race when you have $100K in winnings in your pocket.

Greed usually overcomes most comfort levels and it also motivates people to work harder if they think they are going to win.

It's obviously tough to understand unless you are in the situation.

[sjk]

I guess everyone is different.

[InsideThePylons-MW]

I guess everyone is different.

Gambling reflects life.

If you have a business and it's making 100K a year, you probably try to fly on Southwest.

If your business now makes 10 million a year, Southwest is probably your last possible option.

Your comfort level rises with bankroll success.

[Cangamble]

I don't find the analogy fitting.

Most players are purchasing entertainment (or you would at least hope so because most players are not making money). If you go to the amusement park and can buy 10 rides for $10 would you buy twice as many if they were only $9. Maybe you only want to go on 10 rides.

Perhaps a player finds a $50 bet entertaining but finds that a $100 bet is an unpleasant stressful experience. Most people don't know whether their finanacial expectation is positive even after the reduced takeout. Why do something stressful with an uncertain and unknown outcome?

Even if a player knows he has a positive expectation he probably has a bet level that he is comfortable with. Maybe the extra profit at the end of the day is not meaningful enough to his standard of living to want to turn a pleasant pastime into something beyond his comfort level.
There are real life examples of how betting goes up tremendously with rebates. Ask most of the PTC customers here.

[Kelso]

Sharp thoughts.

If I was buying 5 c-notes for $100 each, I'm sure if I could buy them for $90, I would still only buy 5.

Better you borrow every cent you could and churn, churn, churn. Even at 10% DAILY interest, you'd make a buck just by immediately flipping every c-note back at par. Hell, an immediate $99.01 still puts you ahead.

Silly examples, all ... but provide a route to even a reasonably reliable profit and many will play it as big as they are able.

[ezrabrooks]

Churn, churn, chrun at the windows equals lose, lose lose, I don't care if the take out is 7% or 20%. I really believe that a lower takeout will not turn unprofitable players into positive ones...much less make millionaires. How many consistent minus 5% ROI players are they, who would instantly benefit from a lower take out and become positive?

No doubt that take outs are to high, and should be lowered...but keep in mind, Markets adjust, so those losing before a reduction, will probably still be losing after same, and those winning before....well you get the picture.

[Rook]

Churn, churn, chrun at the windows equals lose, lose lose, I don't care if the take out is 7% or 20%. I really believe that a lower takeout will not turn unprofitable players into positive ones...much less make millionaires. How many consistent minus 5% ROI players are they, who would instantly benefit from a lower take out and become positive?


Well, I am one. Without rebate, I had 2 winning years out of 8. With rebate, I am 4 for 4 with an exponential rise in betting activity. If others were more willing to discuss their finances in a public forum, there would be a bunch of stories quite similar.

[JimG]

Churn, churn, chrun at the windows equals lose, lose lose, I don't care if the take out is 7% or 20%. I really believe that a lower takeout will not turn unprofitable players into positive ones...much less make millionaires. How many consistent minus 5% ROI players are they, who would instantly benefit from a lower take out and become positive?

No doubt that take outs are to high, and should be lowered...but keep in mind, Markets adjust, so those losing before a reduction, will probably still be losing after same, and those winning before....well you get the picture.

If your an out of control gambler, you are correct. However, if you are losing a small pct., then rebates and lower takeout could definitely turn a loser into a winner.

[Rook]

7% is the number that gets discussed the most but it is on the low end of what rebates are offered. Looking through my records indicates that the average is 11.3% for those who concentrate on exotics. This has a gigantic impact on how often a half decent handicapper has a postive expectation.

[Cangamble]

Churn, churn, chrun at the windows equals lose, lose lose, I don't care if the take out is 7% or 20%. I really believe that a lower takeout will not turn unprofitable players into positive ones...much less make millionaires. How many consistent minus 5% ROI players are they, who would instantly benefit from a lower take out and become positive?

No doubt that take outs are to high, and should be lowered...but keep in mind, Markets adjust, so those losing before a reduction, will probably still be losing after same, and those winning before....well you get the picture.
My premise to reduce track takeouts is not one to hurt the tracks.

1. John Q Smith has X amount of dollars he loses in a given year (though he doesn't usually start out the year and say "this is my limit"
2. He is a good handicapper and has a ROI of .90
3. He looks at racetrack betting as a losing proposition, so he bets only 40% of his total betting on horses, the rest goes to sports and poker.

The track winds up getting only 40% of his total betting bankroll for the year, whether it is ADW's or live track betting.

John gets a 7% rebate, and figures he now has the possibility of winning at the track if he focuses more. Now he allocated 85% of his betting bankroll on horses. Good chance that John or others like John who have much lower ROI's will still lose money. The thing is, they will lose more on horse racing and they will bet a lot more to do so.

The winners who are made because of the drop in takes or the rebates will bet much larger...human nature and greed go hand in hand....and bragging rights when it comes to beating horses will difuse to the general public....creating more players, and more losers (not losers in a bad way, but a good way for the tracks and horsemen accounts)....in the end, the tracks will end up with a lot more money.

And I'm not even taking into account the fact that PTC has taken away a lot of offshore monies that didn't go into the pools and didn't make the tracks or horsemen one red cent.

[Premier Turf Club]

Churn, churn, chrun at the windows equals lose, lose lose, I don't care if the take out is 7% or 20%. I really believe that a lower takeout will not turn unprofitable players into positive ones...much less make millionaires. How many consistent minus 5% ROI players are they, who would instantly benefit from a lower take out and become positive?

Absolutely, 100% incorrect.

Many of our largest players are about -4 to -7% before rebates and profitable after them. They have also told me to a man that there post-rebate handle is 3x-10x higher than their pre-rebate handle.

[Cangamble]

7% is the number that gets discussed the most but it is on the low end of what rebates are offered. Looking through my records indicates that the average is 11.3% for those who concentrate on exotics. This has a gigantic impact on how often a half decent handicapper has a postive expectation.
The exotics that offer the greatest rebate usually have the greatest takeout.

[Rook]

He looks at racetrack betting as a losing proposition, so he bets only 40% of his total betting on horses, the rest goes to sports and poker.

The track winds up getting only 40% of his total betting bankroll for the year, whether it is ADW's or live track betting.

John gets a 7% rebate, and figures he now has the possibility of winning at the track if he focuses more. Now he allocated 85% of his betting bankroll on horses. Good chance that John or others like John who have much lower ROI's will still lose money. The thing is, they will lose more on horse racing and they will bet a lot more to do so.


You are absolutely correct. I'm sure I am like many others who have an active gambling gene. I will seek out action wherever I think I have the best chance. From 1996 thru 2003, I didn't touch horse racing because I viewed football, baseball and hockey as better opportunities. Rebates have completely changed my mind and priorities.

[thruncy]

Amen to the end of Evans.:jump:

[Pace Cap'n]

Guess he's not gone yet--$6.282mil--wow...

It's hard to feel much sympathy for an organization, Churchill Downs Inc., that managed to hand its president and chief executive officer, Robert Evans, a $6.282 million compensation package last year ($450,000 in salary plus stock and option awards). If Churchill can provide Evans with an $87,845 ground-transportation allowance, it's hard to believe some allowance can't be made for the people shipping in the horses. Gas is $4 a gallon, and horse vans aren't exactly economy models.

www.courierjournal.com (http://www.courier-journal.com/apps/pbcs.dll/article?AID=/20080526/COLUMNISTS02/805260486/1002/SPORT)

[rrbauer]

Good article. Thanks for the link.

[Grits]

Kentucky horsemen have asked court to stop purse reductions at Churchill.

http://www.thoroughbredtimes.com/national-news/2008/May/27/Kentucky-horsemen-ask-court-to-halt-purse-reduction.aspx

[Kelso]

www.courierjournal.com (http://www.courierjournal.com/)The hack who worte this piece obviously understands little about the economics of the business, which is why he actually wrote so little about it. Instead, he was happy to unquestioningly regurgitate the horsemen's horseshit in order to meet his daily quota of column inches.