The Racing Industry never ceases to amaze

[NoCal Boy]

We are in the midst of a national economic mess, with sky high gasoline prices and other cost of living increases, and the racing industry somehow finds a way to restrict horseplayers abilities to place a wager on their favorite track through ADW. Why? Because certain ADW's desire to maintain exclusive control over content, be it TVG content or Tracknet content, unless economic demands are satisfied, and the horsemen joining together to form the THG demanding a simply unworkable 1/3 of gross takeout for purses on ADW wagers.

My guess is the TVG-Tracknet battle could be resolved if the THG matter was resolved on purse contributions.

Do the horsemen really believe more people will go to the track and OTB's if they restrict ADW? Can they be that naive? We have a story in the bloodhorse today stating that handles have dropped in the double digits since the end of the triple crown races. Of course!!! Between the economy and the limited access to signals, what do you expect? Racing has it hard enough without more obstacles being placed in its way for attracting handle. It is simply common sense that people will not be driving to the tracks or to the OTB's to make up for the shortfall in ADW handle from these blocked signals.

Del Mar is another classic case. While the TVG-Tracknet dispute is the culprit for access being limited to TVG and Youbet, the DRF is reporting today that ADW handle is actually up 12% over the first 5 days versus last year. This is not insignificant as ADW handle is significant at Del Mar. It is even an apples verus apples comparison as TVG and Youbet only had access last year. Why is handle up double digits at TVG and Youbet on Del Mar? Because people do not want to spend the money to drive because of the economy and gas prices. Not everyone, but a meaningful number. How else do you explain the 12% increase in ADW at Del Mar? meanwhile the THG has blocked signals at other tracks and handles plummet. Why? because they want an absurdly unreasonable 1/3 of the gross for purses. There is a number that works for all. Whether that is 25% or whatever, but it is not 1/3 of the gross. Ellis Park had to give away its portion of the commissions from ADW wagers simply to get the signal back on. I seriously doubt any other track will or can do that over the longer term.

I have no other option than to conclude racing is run by a bunch of buffoons who can not understand that the sum of the parts is far greater than the individual components. For racing to succeed, you need the tracks, the horsemen and the ADW's. It is that simple in the 21st century. Individually the ability to succeed is very difficult, but together, the sum of the parts, could be quite nice for all.

Imagine a track that has a takeout of 20%. 25% goes to the purses, 25% to the host track and the balance to the ADW. Of course, the ADW has to pay its taxes, fees, costs and expenses, player promotions and shareholders/investors or it will be out of business, so its true take is far less than 10%. An ADW also helps to generate interest to the game and brings churn in handle to the industry. The tracks get substantially more than at present, and the horsemen get substantially more than at present. An industry actually working!!

Is this so difficult to comprehend? No one compensated in an abnormally high manner, but all win, as well as the horseplayers playing through the ADW's!!

[trigger]

We are in the midst of a national economic mess, with sky high gasoline prices and other cost of living increases, and the racing industry somehow finds a way to restrict horseplayers abilities to place a wager on their favorite track through ADW. Why? Because certain ADW's desire to maintain exclusive control over content, be it TVG content or Tracknet content, unless economic demands are satisfied, and the horsemen joining together to form the THG demanding a simply unworkable 1/3 of gross takeout for purses on ADW wagers.

My guess is the TVG-Tracknet battle could be resolved if the THG matter was resolved on purse contributions.

Do the horsemen really believe more people will go to the track and OTB's if they restrict ADW? Can they be that naive? We have a story in the bloodhorse today stating that handles have dropped in the double digits since the end of the triple crown races. Of course!!! Between the economy and the limited access to signals, what do you expect? Racing has it hard enough without more obstacles being placed in its way for attracting handle. It is simply common sense that people will not be driving to the tracks or to the OTB's to make up for the shortfall in ADW handle from these blocked signals.

Del Mar is another classic case. While the TVG-Tracknet dispute is the culprit for access being limited to TVG and Youbet, the DRF is reporting today that ADW handle is actually up 12% over the first 5 days versus last year. This is not insignificant as ADW handle is significant at Del Mar. It is even an apples verus apples comparison as TVG and Youbet only had access last year. Why is handle up double digits at TVG and Youbet on Del Mar? Because people do not want to spend the money to drive because of the economy and gas prices. Not everyone, but a meaningful number. How else do you explain the 12% increase in ADW at Del Mar? meanwhile the THG has blocked signals at other tracks and handles plummet. Why? because they want an absurdly unreasonable 1/3 of the gross for purses. There is a number that works for all. Whether that is 25% or whatever, but it is not 1/3 of the gross. Ellis Park had to give away its portion of the commissions from ADW wagers simply to get the signal back on. I seriously doubt any other track will or can do that over the longer term.

I have no other option than to conclude racing is run by a bunch of buffoons who can not understand that the sum of the parts is far greater than the individual components. For racing to succeed, you need the tracks, the horsemen and the ADW's. It is that simple in the 21st century. Individually the ability to succeed is very difficult, but together, the sum of the parts, could be quite nice for all.

Imagine a track that has a takeout of 20%. 25% goes to the purses, 25% to the host track and the balance to the ADW. Of course, the ADW has to pay its taxes, fees, costs and expenses, player promotions and shareholders/investors or it will be out of business, so its true take is far less than 10%. An ADW also helps to generate interest to the game and brings churn in handle to the industry. The tracks get substantially more than at present, and the horsemen get substantially more than at present. An industry actually working!!

Is this so difficult to comprehend? No one compensated in an abnormally high manner, but all win, as well as the horseplayers playing through the ADW's!!

IMHO, takeout has to be immediately reduced by at least 5% to 15% in order to even start to compete with other gambling options. Otherwise, the long term viability of horse racing is in jeopardy.

[KMS]

I've thought for quite a while that racing is run by people who weren't smart enough to make the cut in other gambling/entertainment venues. If somebody like Steve Wynn ever bought a track, the others would have to adapt or be run out of business in short order.

[JustRalph]

I've thought for quite a while that racing is run by people who weren't smart enough to make the cut in other gambling/entertainment venues. If somebody like Steve Wynn ever bought a track, the others would have to adapt or be run out of business in short order.

Wynn missed out on NYRA


http://topics.nytimes.com/top/reference/timestopics/subjects/a/aqueduct_race_track/index.html?query=WYNN,%20STEVE&field=per&match=exact

April 10, 2007
Steve Wynn will join Exelsior Racing Associates with developers Steven Roth and Richard Bronson; four consortiums are vying for rights to run Saratoga, Aqueduct and Belmont racetracks in New York

[KMS]

Wynn missed out on NYRA


http://topics.nytimes.com/top/reference/timestopics/subjects/a/aqueduct_race_track/index.html?query=WYNN,%20STEVE&field=per&match=exact

April 10, 2007
Steve Wynn will join Exelsior Racing Associates with developers Steven Roth and Richard Bronson; four consortiums are vying for rights to run Saratoga, Aqueduct and Belmont racetracks in New York

What a shame. That had potential.

[InsideThePylons-MW]

Steve's people realized instantly that they could never do anything they wanted to do because they had zero control over anything.

[rrbauer]

Del Mar is another classic case. While the TVG-Tracknet dispute is the culprit for access being limited to TVG and Youbet, the DRF is reporting today that ADW handle is actually up 12% over the first 5 days versus last year.

ADW increase is offset by reductions in on-track and simulcast handle. This result is predictable and you can expect more of the same. It's why the THG, TOC, et al, drew the line in the sand over the ADW issue.

[Bruddah]

ADW increase is offset by reductions in on-track and simulcast handle. This result is predictable and you can expect more of the same. It's why the THG, TOC, et al, drew the line in the sand over the ADW issue.

That SYNERGY is created when the sum of the parts became greater than the whole. :ThmbUp:

[Imriledup]

For some reason, track execs and the higher ups in the game keep trying to hold on to the glory days and are messing with the natural curve of change. People have options now, they aren't going to pack racetracks like they did in the monopoly days, now people can bet anything online...poker, horses, sports you name it, people have many ways to gamble and the entertainment options are also greater.


So, what do racetracks do.....they restrict people from betting in certain ways in the hopes that if that person doesn't get to bet thru the phone or online that they are going to physically go to the track and play. So, for every customer that WILL actually schlep to the track, the other 9 (9 out of 10) will stay home and just not bet. THat person who goes to the track is most likely a 2 dollar bettor because lets face it, aren't most people 2 dollar bettors? There aren't too many guys betting 5k per race and playing millions thru the windows.

[DeanT]

For some reason, track execs and the higher ups in the game keep trying to hold on to the glory days and are messing with the natural curve of change. People have options now, they aren't going to pack racetracks like they did in the monopoly days, now people can bet anything online...poker, horses, sports you name it, people have many ways to gamble and the entertainment options are also greater.


So, what do racetracks do.....they restrict people from betting in certain ways in the hopes that if that person doesn't get to bet thru the phone or online that they are going to physically go to the track and play. So, for every customer that WILL actually schlep to the track, the other 9 (9 out of 10) will stay home and just not bet. THat person who goes to the track is most likely a 2 dollar bettor because lets face it, aren't most people 2 dollar bettors? There aren't too many guys betting 5k per race and playing millions thru the windows.

Protectionism and forcing people to do something seems to be the though du jour with some. They could do that in a monopoly. Now they cant.

I got an interesting comment this morning:

I bet Tampa Bay, Ohio(Beulah,River Downs and some Thistle Downs) and Indiana Downs and Hoosier. This year Beulah lost so many dates I quit bothering to pull down the programs. Now Ohio is off limits to Twinspires. Despite having excellent meets at TB and Indiana Downs I'm now on idle. They have just opened Pinnacle Downs in Michigan but it is 50 miles from my house and and with construction everywhere I have yet to attend. A 1995 Michigan law prevents Michigan residents from betting Michigan tracks on the internet. That is why my betting is down.

Anyone know anything about this? If it is factual, Michigan might want to look into changing this law. I am no Kreskin, but this Internet thing might catch on.

[Tom]

Dean, I'm 7 miles from Finger Lakes, and not only can't I bet it, I can't even Watch the video live! If they thought they would force me to the track, they were wrong. I have been there three times in three years now. Used to go at least 150-200 times a year. I am not alone.

[DeanT]

Amazing Tom, just flabbergasting.

I think Nick Kiling wrote a piece awhile back (I cant find it) where he said he could buy a stock on teh Shanghai stock exchange in his underwear at 3AM with the click of a mouse, but he cant bet a race across the street the same way.

[Bruddah]

Dean, I'm 7 miles from Finger Lakes, and not only can't I bet it, I can't even Watch the video live! If they thought they would force me to the track, they were wrong. I have been there three times in three years now. Used to go at least 150-200 times a year. I am not alone.

and it amazes me that they want to be Racinos. They cant even keep their old fans. They really don't want them. Management has done everything to run them off. They think they will be profitable because they have slots. Who the h*ll is going to sit in those slot chairs? If you think I am wrong, please ask Frank Stronach. He can't get them (new players) inside of Gulf Stream. New facility, new machines, new everything except for the same old race track management THINKING.

Idiots!!

[JustRalph]

Anyone know anything about this? If it is factual, Michigan might want to look into changing this law. I am no Kreskin, but this Internet thing might catch on.


Wouldn't surprise me. This is the same state that complained when they were losing businesses. Then complained again when they raised their taxes on business 5%. When a survey revealed more young people leaving michigan than anywhere else........they raised the income tax rate.......... :bang:

[takeout]

I think West Virginia does this too.
Tom's right. It's not about to force anyone to the track. It DOES force them elsewhere.
What could possibly be the thinking behind this lunacy?