Rebates?.. Something to think about.

[rwwupl]

Rebates? ..Something to think about.

by Roger Way,

Only my personal view…





Horse racing will never return to prominence until we expand the fan base (handle) instead of creating conditions that chase the newcomer away. As long as this industry has no other way to finance purses for horsemen, we are going to have to rely on the customer takeout from bets. Concerts and Hat Contests do not create purse money. This industry is not primarily entertainment; it is supported by gaming dollars produced by a customer participation in a pari-mutuel system.

The facilitator takes money from the top of a finite pool and the rest is divided among the winners. The more winners there are, the lower the payout, the fewer winners there are the higher the payout. Customers are in competition with each other. On the original premise of the pari-mutuel system, and over the long term, the only way a customer should be rewarded to prevail over his competition is through skill and knowledge and it is called in a larger sense … handicapping.

In order for this man to man competition to be fair, there must be a level playing field, for all the competitors.

When one of the players are granted rebates (for whatever reason) by being selected by an unqualified person who does not care about the competition among individuals, and only to lure business to his interest, it creates an advantage for the person with a rebate (lower cost of bet) over the person without a rebate. (Higher cost of bet). If the rebate person was a horse, it would be like giving him a head start in a race.…this is called an unlevel playing field. It is most common in use by the ADW’s. With all things being otherwise equal, the rebate player will play more horses, cash more bets, churn more money through the pools, and will last longer, have an opportunity to learn more about the game, and maintain a huge advantage over the non-rebate player, while spending the same amount of money, because of his rebate.. The player with a bigger wallet will get rebates over the backbone of the game, the two dollar bettor. It is hard to maintain a fan base, much less encourage growth under these conditions.

The requirement and time needed for the non-rebate player to develop higher skill levels to succeed is diminished. Handicapping has become less important and takes a back seat to “who you know” and how big is your rebate? Newcomers do not get rebates, unless it is under the “who you know” rule.

People understand after a while that if they are a non- rebate player, they are subsidizing the rebate player, who bets more, cashes more tickets, for the same money, even if the non-rebate player is more skillful. This destroys the fair competition of man to man and makes handicapping moot. Why should a newcomer learn about the game?

Certain States have laws that make rebates for their citizens a no- no, others do not.

Old fashioned favoritism has triumphed over man to man competition.

Those players, who get an advantage through rebates, will fight to maintain their advantage, with lame excuses to deny others, but they know it is not right for the good or growth of the game, but like everything else in horse racing, the “Me First” attitude prevails.

All of this has occurred because of short sighted, bean counting racing managers who do not understand the gaming portion of the industry, handicapping or what the pari-mutuel system is about. It is broken.

Can we return to prominence? Can we fix it?... Heck yes, Those who say no, it is too far gone and difficult to change are grinding their own axe, and they prefer the current arrangements out of greed and have little vision.

It starts with leaders, who do not understand the gaming portion of what they are leading, and they are lacking, but that will change too… and when you rebuild something that is broken, you lay one brick at a time.

Existing conditions have nothing to do with what is right or wrong.

It is not too late, we can fix it, let us get started, the people love horse racing, lets give them our best...because horse racing will be here long after we are gone.

rwwupl

[andymays]

Why do California Players Pay More to Bet?

By rwwupl

Rebates to favored customers are something that works to the deficit of California players and the industry in general. Many ADW,s offer rebates, but under present California state law, sponsored by the TOC there is a 6.5% Retention Cap on ADW wagers generated within the state of California. There is no state law prohibiting rebates in California, but the retention cap leaves no wiggle room for California players to receive the rebate percentages that ADWs offer other out of state players. Yes, there are certain favored California individuals offered up to 3% in California, but it is very selective, and is not public knowledge. ADWs offer rebates to favor out of state players on California tracks around 8% rebate. Takeout, plus any rebate, is the cost of the bet to the player.

We are a customer driven participant sport, not a spectator sport. Customers compete against each other. The customer with a lower cost of bet will last longer, win more often and create more churn (handle) than the customer that has a higher takeout to overcome.

How can you or why would you as a customer want to compete with others who have been granted a head start by the house? The newcomer is asked to compete on an unlevel playing field. If you live in California, you are subsidizing California players who live out of state. California players must avoid the law and seek other places to bet if they want a lower cost and competitive deal…many of these other sources do not report to the mainstream and all Californians lose revenue.

HANA estimates through player interviews that billions of dollars each year of U.S and Canadian thoroughbred handle is wagered out of the pari-mutuel pools.

Legislating higher purses does not solve the problem. We have tried this before, with $40 million extra for purses via SB27 a few years ago. All it brought was higher prices for everything horses in California, and new cars for the owners. Because that did not work, we now are asked to throw in another $70 million via SB2414, for purses at the direct expense of the customers. The business model is unbalanced and broken.

Has it occurred to California racing managers that customer relief of the takeout is the surest and swift way to increase customer participation and handle?

Handle is everything in horse racing. To increase handle you must have more fans betting more money. We can not achieve this by charging more and more for the bet and creating the perception of bias and favoritism to certain customers.

The CHRB is there to protect the interests of California bettors. We can only look to them to free the California player from the unequal cost of the bet, and serve a measure of justice to the California customers.

[Stillriledup]

This is not true. You can sign up for 'clubs' at certain tracks that give rebates. For example, the Big M Club at the Meadowlands gives rebates to even the smallest of players. Instead of complaining about how life is unfair, i'd suggest that bettors be proactive and get out there and figure out a way to get some money back.

[rwwupl]

This is not true. You can sign up for 'clubs' at certain tracks that give rebates. For example, the Big M Club at the Meadowlands gives rebates to even the smallest of players. Instead of complaining about how life is unfair, i'd suggest that bettors be proactive and get out there and figure out a way to get some money back.


The first article was a reprint of an editorial for the west coast, the second article title was CALIFORNIA players, and other states have different rules too, that creates a problem. No one complained about life was unfair... the point is horse racing would do better if they treated the customers with respect and equal conditions.


I do O.K. at the windows, thanks

[Robert Fischer]

i'm confused as to why andymays is posting for rwwupl now :confused:

[andymays]

i'm confused as to why andymays is posting for rwwupl now :confused:

I liked what he had written and thought it would help the thread. California Players are in a differnt situation than most.

Something wrong?

[Robert Fischer]

I liked what he had written and thought it would help the thread. Something wrong?

just seems odd to me. I suppose as long as you guys don't care, you can do what thou wilt

[andymays]

just seems odd to me. I suppose as long as you guys don't care, you can do what thou wilt

Thanks. Horseplayers can be an odd bunch I guess.

[Robert Fischer]

Thanks. Horseplayers can be an odd bunch I guess.

especially those that pop off at the mouth :D

[andymays]

especially those that pop off at the mouth :D

and especially the ones that get involved in things that are none of their business. :D

[Robert Fischer]

you're taking this way too seriously. Something wrong?

[andymays]

you're taking this way too seriously. Something wrong?

No, I'm not taking this seriously at all.

I think rwwupl did a good job in both pieces.

[Robert Fischer]

off topic - i think your little green "andymays is online now" light burned out.

[andymays]

off topic - i think your little green "andymays is online now" light burned out.

You might want to read post #11.

[Robert Fischer]

before andymays baited me into this childish exchange,

I did want to briefly exercise my opinion on Rebates and ask some questions.

QUESTION FOR rwwupl:

First, I DO have a problem with REBATES when:
THE BASIC UNIT OF TAKEOUT IS RAISED TO "MAKE UP" FOR REBATES...

CONVERSELY- I DON'T have a problem w/ REBATES WHEN:
ADDITIONAL HIGHVOLUME(WHALES) CUSTOMERS ARE SIGNED UP BY TRACKS BY THEM USING REBATES, WITHOUT CHANGING THE BASIC UNIT OF TAKEOUT FOR ANYONE ELSE.
-in other words when the tracks decide that the marginalprofIT from HIGH-VOLUME players are worth buying those players services even at a rebate because the Marginal Profit will more than cover the MARGINAL COST. this model clearly does not demand that other player's takes be raised. However - there is argument that these inequalities lead to pool manipulation at least to some degree.

Can you comment on the above question/scenario as to whether it currently exists, as well as your stance(and possibly HANA's official stance)

Thanks

Jay

[andymays]

before andymays baited me into this childish exchange,

I did want to briefly exercise my opinion on Rebates and ask some questions.

QUESTION FOR rwwupl:

First, I DO have a problem with REBATES when:
THE BASIC UNIT OF TAKEOUT IS RAISED TO "MAKE UP" FOR REBATES...

CONVERSELY- I DON'T have a problem w/ REBATES WHEN:
ADDITIONAL HIGHVOLUME(WHALES) CUSTOMERS ARE SIGNED UP BY TRACKS BY THEM USING REBATES, WITHOUT CHANGING THE BASIC UNIT OF TAKEOUT FOR ANYONE ELSE.
-in other words when the tracks decide that the marginalprofIT from HIGH-VOLUME players are worth buying those players services even at a rebate because the Marginal Profit will more than cover the MARGINAL COST. this model clearly does not demand that other player's takes be raised. However - there is argument that these inequalities lead to pool manipulation at least to some degree.

Can you comment on the above question/scenario as to whether it currently exists, as well as your stance(and possibly HANA's official stance)

Thanks

Jay

See post #5.

[Track Collector]

If you are aware that rebates exist, then whether or not you receive them is a personal CHOICE you make. They are available for just about any wagering level. If you live in a state that does not allow them, you have a CHOICE to stay there or move to a state that allows them. Your reason for remaining in a state that does not allow rebates may be family, or job-related, or something else, but again it is a CHOICE that YOU make. Life if fully of situations where we are forced to make choices when we would prefer not too. There is no getting everything we want. (One other option is of course to become an activist to change the rebate laws in your state.)

While not all rebates are equal, one has the ability (thru their own good handicapping skill) to grow their bankroll and increase their handle over time, thus qualifying for even higher rebates. The sky is high for those who discover the keys to successful handicapping.

So, the CHOICE belongs to each one of us.

[andymays]

If you are aware that rebates exist, then whether or not you receive them is a personal CHOICE you make. They are available for just about any wagering level. If you live in a state that does not allow them, you have a CHOICE to stay there or move to a state that allows them. Your reason for remaining in a state that does not allow rebates may be family, or job-related, or something else, but again it is a CHOICE that YOU make. Life if fully of situations where we are forced to make choices when we would prefer not too. There is no getting everything we want.

While not all rebates are equal, one has the ability (thru their own good handicapping skill) to grow their bankroll and increase their handle over time, thus qualifying for even higher rebates. The sky is high for those who discover the keys to successful handicapping.

So, the CHOICE belongs to each one of us.

or you can fight to get the rules in California changed.

[Stillriledup]

or you can fight to get the rules in California changed.

Or, you can move. :jump:

[Track Collector]

You replied before my edited response.:)

[andymays]

Or, you can move. :jump:

Or you can just stop playing like so many Horseplayers already have.

[Robert Goren]

What is often forgotten in the rebate debate is without them there would be no whales. What money is that is taken from the whales bets after the rebates is money that the tracks would not have gotten otherwise. From the tracks point of view rebates to whales is a good business practice.

[Robert Fischer]

See post #5.
you're not roger, right?

seriously, it was fun, but now I would like to ask the thread starter a question.







QUESTION FOR rwwupl:

First, I DO have a problem with REBATES when:
THE BASIC UNIT OF TAKEOUT IS RAISED TO "MAKE UP" FOR REBATES...

CONVERSELY- I DON'T have a problem w/ REBATES WHEN:
ADDITIONAL HIGHVOLUME(WHALES) CUSTOMERS ARE SIGNED UP BY TRACKS BY THEM USING REBATES, WITHOUT CHANGING THE BASIC UNIT OF TAKEOUT FOR ANYONE ELSE.
-in other words when the tracks decide that the marginalprofIT from HIGH-VOLUME players are worth buying those players services even at a rebate because the Marginal Profit will more than cover the MARGINAL COST. this model clearly does not demand that other player's takes be raised. However - there is argument that these inequalities lead to pool manipulation at least to some degree.

Can you comment on the above question/scenario as to whether it currently exists, as well as your stance(and possibly HANA's official stance)

Thanks

Jay

[Stillriledup]

Or you can just stop playing like so many Horseplayers already have.

Or, you can go away and not return, absolutely. :(

[Robert Fischer]

However - there is argument that these inequalities lead to pool manipulation at least to some degree.

I think this would be the crux of the issue from my perspective.

understanding just how much manipulation would occur.

If the manipulation was less of a factor than the increase in pool size(something that would directly affect my incentive to play)...

and how much extra profit signing on those whales would provide the tracks, and the small indirect effects that all players would feel (provided those profits weren't just mismanaged as usual).

maybe these were too complex of a question and I need to keep it basic ... oh well. I'm sure mays will do a good job of repeating whatever messages to the point that a few people will probably follow.:ThmbUp:

[Stillriledup]

you're not roger, right?

seriously, it was fun, but now I would like to ask the thread starter a question.







QUESTION FOR rwwupl:

First, I DO have a problem with REBATES when:
THE BASIC UNIT OF TAKEOUT IS RAISED TO "MAKE UP" FOR REBATES...

CONVERSELY- I DON'T have a problem w/ REBATES WHEN:
ADDITIONAL HIGHVOLUME(WHALES) CUSTOMERS ARE SIGNED UP BY TRACKS BY THEM USING REBATES, WITHOUT CHANGING THE BASIC UNIT OF TAKEOUT FOR ANYONE ELSE.
-in other words when the tracks decide that the marginalprofIT from HIGH-VOLUME players are worth buying those players services even at a rebate because the Marginal Profit will more than cover the MARGINAL COST. this model clearly does not demand that other player's takes be raised. However - there is argument that these inequalities lead to pool manipulation at least to some degree.

Can you comment on the above question/scenario as to whether it currently exists, as well as your stance(and possibly HANA's official stance)

Thanks

Jay


I'm not Roger or Andy, but i'll take a crack at it.

I'll call it the 'life is not fair' theory.

In a rebateless world, the more you wager, the higher 'price' you pay for your bet. Lets use this as an example. Two players are standing next to each other handicapping the same race. Player #1 is a 2 dollar bettor who receives no rebate. Player #2 is a big player who also gets no rebate. Player 1 loves the 1 horse, who is currently 3-1 on the board. Player two loves the 2 horse who is also 3-1 on the board.

Player #1 bets 2 dollars to win on the 3-1 shot, his horse will pay 8 dollars should he win. Player #2 is also betting a 3-1 shot, but he's betting a grand to win, so his horse is going down to 5-2, his prospective win price is 7 dollars.

I guess the 64 dollar question is this. Why should the small bettor get to receive 8 dollars while the 'better customer' gets 7? If anyone can answer that, you'll have the key to the universe.

[lamboguy]

this thread relives itself every once in awhile. the problem in this game is not rebates. the main problem is the loss of interest in this great game. who is to blame?

how about the racetracks that figured out that simulcasting was the easy way to the money, how about the racetracks that figured out how to steal more money for themselves by creating tracknet, NYRA for overpricing their signal? yes the racetracks themselves are the guilty party, instead of making an effort to police itself from drugs, cheaters and after the bell betting they worked out a plan to swindle more money out of people so the shirts could keep their useless jobs.

if these guys did the right thing, we would not be having this discussion of rebates. look at the keeneland handle this year, it tells the whole story of a game in jepardy of becoming extinct. i am going to make you a promise that a day will come when the same thing happens to the slot machines as did in the horse racing game/ these guys running the show are nothing short of being imbeciles.

[Rook]

The rebate issue is very straightforward. In order to attract an interest in the sport from serious bettors, the effective takeout has to be far below the non-rebated level. With racing's takeout in the 20s, it can't hope to compete with poker, sports betting or financial markets.

In a perfect world, the tracks and states would significantly lower the takeout for everyone but since we all know that isn't going to happen any time soon, rebates are the only way a player can stay in this game on a full time basis.

If getting rebates was closed off to insiders then there would be plenty of reason to gripe but that is not the case. There are plenty of people here who can hook somebody up with a decent sized rebate.

If you live in a state where it is currently difficult or impossible to get a rebate, take up the issue with the bureaucrats responsible rather than directing your anger at fellow horseplayers who are taking the sensible path to stay in the game.

[thaskalos]

The only gripe I have about the rebate issue is the fact that it has been kept such a secret from the normal, non-rebated player.

In every type of business, the large customer - who buys large quantities of a given product - receives a "wholesale" price which is not available to the customer who buys in more limited quantities. But this is a widely accepted business practice, and everybody knows about it.

For some reason, the racing industry has kept the rebate issue so shrouded in secrecy...that even people playing this game for many years have no idea that such a thing exists.

[lamboguy]

tyhe raThe only gripe I have about the rebate issue is the fact that it has been kept such a secret from the normal, non-rebated player.

In every type of business, the large customer - who buys large quantities of a given product - receives a "wholesale" price which is not available to the customer who buys in more limited quantities. But this is a widely accepted business practice, and everybody knows about it.

For some reason, the racing industry has kept the rebate issue so shrouded in secrecy...that even people playing this game for many years have no idea that such a thing exists.the racing game could use rebates to their advantage, but first they need people interested in the game. bringing in new wagers like the "grand slam" or "quad super" don't add a thing to the game. private training centers like the one in palm meadow doesn't help either. or california raising takeout on people that don't bet with certain rebate shops can only alienate customes. rubber tracks help to get people less interested in the game as well. phony detention barns and supertesting only throws in a monkey wrench to the game. having a racetrack full of useless state employees sitting around singing the bs is a waste as well. having to pay purses for horses that run dead last sets a bad precedent. i say don't pay purses past 3rd place and eliminate the non competetive fields. eliminate a condition book that is full of extra's to try to fill races. if they can't fill the race then don't run a race. there is no law that says you have to run 11 crumby races daily. run the book where the condition comes up every 2 weeks. if you can't get your horse ready for that race, that's to bad, you are going to have to wait for another one. moutaineer used to have control over its book until recently, i could count on a race coming back every 2 weeks there until they dropped the purses and lost the horses in that place. they also lost me a customer there, and probably a few other people, the handle seems to have dropped about 25% year to year.

[Robert Fischer]

Hey Still, I appreciate you giving it a try.

Not sure what happened with Roger Way(i think that is RRWWUPL ?)
If he was just busy or if he's andymays on different names, or if they thought i was asking tough questions to be difficult rather than asking legit questions etc... Probably the guy was just busy and didn't get to look back at the thread. I ended up falling asleep anyway...


I'm not sure you answered the same thing I'm wondering.

1st Im not sure but I think you are saying the big bettor should get rebates? and that is what the whole bet affecting pool-size thing was about.
I think the big bettors should get rebates also, although I don't think over-betting the pools to a point below acceptable value is a good reason for MUCH OF ANYTHING(although again, thanks for taking a crack at it.)

my reasoning for rebates is when a track is looking at a bunch of men who are poker players for example.

if he sees 1 guy out of the pokerstars who would bet a lot on horses with the right deal, then I think it is the "tracks" JOB to attempt to broker that deal with that customer.
The deal should go as follows = how much would it cost the track to take that fellows bets in addition to the bets they already take (eg they wouldn't need to hire new operators, build new infrastructure, pay more tellers etc... the cost for SLAPPING 1 MORE customer on top of the existing infrastructure is called MARGINAL COST and would cost probably - a guess here- around 25-50cents at most! per bet)

now that dude is going to bet on avg $50 per wager
The tracks just have to earn a revenue of more than 50cents from this dude to cover the MARGINAL COST of 50cents.
IF they charged the guy (or started with regular take and rebated it down to) 5% TAKE :eek: the track would get $2.50 marginal REVENUE or in other words THE TRACK WOULD MAKE $2 PER WAGER 'MARGINAL PROFIT' FOR ADDING THAT DUDE TO THE INFRASTRUCTURE. Pretty great for the track, and for that dude , and there is $50 more in the pool for a regular non-rebate guy to win if they are wrong. - Great all the way around.

however the idiot tracks tend to see this type of stuff like drunk amphibians and would be a safe-bet that the tracks would think they had to RAISE TAKE for everyone else a few pts in order to keep total take down etc... (or just like most of everything the track wouldn't see the forest for the trees and miss the point of adding ADDITIONAL GOOD on top of the existing cost structure CUSTOMERS completely)

is horse will pay 8 dollars should he win. Player #2 is also betting a 3-1 shot, but he's betting a grand to win, so his horse is going down to 5-2, his prospective win price is 7 dollars.

I guess the 64 dollar question is this. Why should the small bettor get to receive 8 dollars while the 'better customer' gets 7? If anyone can answer that, you'll have the key to the universe.

[andymays]

Does anyone think rebating has made it easier to raise the takeout over the last several years?

[Horseplayersbet.com]

Does anyone think rebating has made it easier to raise the takeout over the last several years?
How many tracks have increased takeout since rebating has become more mainstream?
If anything, rebating shows tracks how more volume and churn can be created, and this leads to the thinking that takeout is too high, so I would argue that rebating creates downward pressure on takeout rates.

[andymays]

How many tracks have increased takeout since rebating has become more mainstream?
If anything, rebating shows tracks how more volume and churn can be created, and this leads to the thinking that takeout is too high, so I would argue that rebating creates downward pressure on takeout rates.

Hmmmmm. Not sure about that.

I totally get it that people like rebates and I wish California had a different policy and maybe they will change it. It seems like most people agree that the game would be better off with lower takeout and no rebates than with higher takeout and rebates.

[Horseplayersbet.com]

Hmmmmm. Not sure about that.

I totally get it that people like rebates and I wish California had a different policy and maybe they will change it. It seems like most people agree that the game would be better off with lower takeout and no rebates than with higher takeout and rebates.
I agree with you. I'm not sure what you don't get.
As for the rebate laws being changed in California, don't hold your breath. I believe that the excess that would normally go to the ADW to distribute goes to the horsemen and tracks instead. I just don't see them giving it up, even if it means growth. That is not how the California "brain trust" seems to be working these days.
The laws have cost California tons of dough as big players have either stopped, are playing less, or are playing offshore. No different than what has happened in Canada.

[rwwupl]

Hmmmmm. Not sure about that.

I totally get it that people like rebates and I wish California had a different policy and maybe they will change it. It seems like most people agree that the game would be better off with lower takeout and no rebates than with higher takeout and rebates.


The people who like rebates are those who receive them. They have a real advantage over the players who do not receive them.

That is not rocket science.

Of course the industry would be better off without them for a lot of reasons, and would enable the cost of the bet to be reduced to all players... and that is a good thing, because non- rebators are subsidizing rebate players now.

Skill and handicapping ability would return as the most important factor to determine who does the best at the windows, not how big a rebate you get.

I think everyone who is experienced knows this, why argue over minutia ?

[Charli125]

Of course the industry would be better off without them for a lot of reasons, and would enable the cost of the bet to be reduced to all players... and that is a good thing, because non- rebators are subsidizing rebate players now.


Wrong. Please explain how rebates make it hard to lower takeout.

Rebates come from the ADW's margin. Removing rebates increases ADW margin. Removing rebates simply removes more money from the pools and puts it into the pockets of the ADW's. Lowering takeout decreases rebates because the ADW's are not going to accept anything below a certain percentage Margin, thus any takeout decrease comes out of the rebate.

Lowering takeout to the right level will eventually do away with the majority of rebates on it's own, and that's the only way to do it.

[proximity]

In order for this man to man competition to be fair, there must be a level playing field, for all the competitors.



handicapping is not some kind of "man to man competition" mr way.

I WANT YOU TO BE ABLE TO GET REBATES, AND HOPEFULLY EVEN BETTER REBATES THAN I'M GETTING.

this could only be good for the game.

now if it was track and field i wouldn't want you to get a head start in the 400meters. there is a difference.

[proximity]

Does anyone think rebating has made it easier to raise the takeout over the last several years?


it didn't help at pocono where they ended up lowering the huge tri take.

[andymays]

handicapping is not some kind of "man to man competition" mr way.


Parimutuel betting - Wikipedia, the free encyclopedia

http://en.wikipedia.org/wiki/Parimutuel_betting

Excerpt:

Unlike many forms of casino gambling, in parimutuel betting the gambler bets against other gamblers, not the house. The science of determining the outcome of a race is called handicapping.

It is possible for a skilled player to win money in the long run at this type of gambling, but overcoming the deficit produced by taxes, the facility's take, and the breakage is difficult to accomplish and few people are successful at it.

Independent off-track bookmakers have a smaller take and thus offer better payoffs, but they are illegal in some countries. However, with the introduction of Internet gambling has come "rebate shops". These off-shore betting shops in fact return some percentage of every bet made to the bettor. They are in effect reducing their take from 15-18% to as little as 1 or 2%, still ensuring a profit as they operate with minimal overhead. Rebate shops allow skilled horse players to make a steady income.

[Stillriledup]

The people who like rebates are those who receive them. They have a real advantage over the players who do not receive them.

That is not rocket science.

Of course the industry would be better off without them for a lot of reasons, and would enable the cost of the bet to be reduced to all players... and that is a good thing, because non- rebators are subsidizing rebate players now.

Skill and handicapping ability would return as the most important factor to determine who does the best at the windows, not how big a rebate you get.

I think everyone who is experienced knows this, why argue over minutia ?


This is the one thing i don't seem to understand, help me out here. I don't get how non rebaters are subsidizing rebaters. Tell me how its different if the non rebater is betting into a 100k win pool of rebate money vs non rebate money. Part of the 100k bet into any particular pool can be part rebate money and part inheritence from long lost grandma. 100k is 100k, it doesnt matter at all where it actually came from. Unless i'm just not understanding what you're trying to say. (which i think must be the case)

[andymays]

This is the one thing i don't seem to understand, help me out here. I don't get how non rebaters are subsidizing rebaters. Tell me how its different if the non rebater is betting into a 100k win pool of rebate money vs non rebate money. Part of the 100k bet into any particular pool can be part rebate money and part inheritence from long lost grandma. 100k is 100k, it doesnt matter at all where it actually came from. Unless i'm just not understanding what you're trying to say. (which i think must be the case)

He's talking about California. Since they don't pay California players much at all (only the biggest players can get up to 3%) they can pay more to out of state players. They are in effect screwing the players in their own state. These are the same players they want to attend live racing.

[Stillriledup]

He's talking about California. Since they don't pay California players much at all (only the biggest players can get up to 3%) they can pay more to out of state players. They are in effect screwing the players in their own state. These are the same players they want to attend live racing.

Yesterday's first race at Hollywood had a 40k exacta pool and a 40k tri pool. There were days, back in the day, when California racing would regularly have exotics pools that were 200 and 300k, its comical how far California racing has gone in the toilet. I blame plastic tracks, players are just saying NO.

[proximity]

Parimutuel betting - Wikipedia, the free encyclopedia

http://en.wikipedia.org/wiki/Parimutuel_betting

Excerpt:

Unlike many forms of casino gambling, in parimutuel betting the gambler bets against other gamblers, not the house. The science of determining the outcome of a race is called handicapping.

.

no need to be patronizing mr mays.

again, i get rebates, and want not only you and mr way, but all california bettors to be able to get rebates..... and even better rebates than i get if you can...... why?

because it would be good for the game and would not hurt me.

but if i was running track, i wouldn't want you to have a head start. that would hurt me. again, there is a difference.

[andymays]

no need to be patronizing mr mays.
again, i get rebates, and want not only you and mr way, but all california bettors to be able to get rebates..... and even better rebates than i get if you can...... why?

because it would be good for the game and would not hurt me.

but if i was running track, i wouldn't want you to have a head start. that would hurt me. again, there is a difference.

You made the point to Mr. Way that handicapping is not some kind of "man to man competition" when in fact it kind of is. No big deal.

rwwupl is saying that the game would be better off with lower takeout and no rebates. If they didn't pay rebates they could lower the take right?

[InsideThePylons-MW]

If they didn't pay rebates they could lower the take right?

Let me try and explain.

CA tracks do not pay rebates.
ADW's pay rebates out of their bet-taking commission.

CA tracks set the takeout rates.
ADW's have nothing to do with takeout rates.

So....given the above facts.....How could anybody that pays rebates lower the takeout?

[andymays]

Let me try and explain.

CA tracks do not pay rebates.
ADW's pay rebates out of their bet-taking commission.

CA tracks set the takeout rates.

ADW's have nothing to do with takeout rates.

So....given the above facts.....How could anybody that pays rebates lower the takeout?

Yes, the tracks set the takeout rates. I think everyone gets that.

I'm pretty sure tracks can pay rebates. I get what you're saying about the ADW's paying rebates to out of state players.


(February of 2009) CHRB Moves to Rescind Anti-Rebate Stance | BloodHorse.com

http://www.bloodhorse.com/horse-racing/articles/49388/chrb-moves-to-rescind-anti-rebate-stance

[proximity]

Those players, who get an advantage through rebates, will fight to maintain their advantage, with lame excuses to deny others, but they know it is not right for the good or growth of the game, but like everything else in horse racing, the “Me First” attitude prevails.


if california would get full card simulcasting and the individual tracks would encourage players to stick around and bet by offering better rebates on charles town than i'm getting, this would be bad for me how???

[thaskalos]

You made the point to Mr. Way that handicapping is not some kind of "man to man competition" when in fact it kind of is. No big deal.

rwwupl is saying that the game would be better off with lower takeout and no rebates. If they didn't pay rebates they could lower the take right?Whether or not parimutuel wagering qualifies to be called "man to man competition" is decided by the "take"...and not by the definition of the term.

A poker game is also considered a "man-to-man" battle...but raise the rake to 10% (not to mention the 20%+ found in horseracing), and the poker game becomes a battle against the house...with no other winner in sight.

The person who started this "horse racing is a battle between the competitors and not against the house" advertising campaign, should be ashamed of himself.

When the "exotics" takeout is averaging at around 25%, the HOUSE becomes the player's most formidable competition....not the other players.

[andymays]

Whether or not parimutuel wagering qualifies to be called "man to man competition" is decided by the "take"...and not by the definition of the term.

A poker game is also considered a "man-to-man" battle...but raise the rake to 10% (not to mention the 20%+ found in horseracing), and the poker game becomes a battle against the house...with no other winner in sight.

The person who started this "horse racing is a battle between the competitors and not against the house" advertising campaign, should be ashamed of himself.

When the "exotics" takeout is averaging at around 25%, the HOUSE becomes the player's most formidable competition....not the other players.

Hence the term "kinda is". But I get everything you're saying.

[Stillriledup]

Whether or not parimutuel wagering qualifies to be called "man to man competition" is decided by the "take"...and not by the definition of the term.

A poker game is also considered a "man-to-man" battle...but raise the rake to 10% (not to mention the 20%+ found in horseracing), and the poker game becomes a battle against the house...with no other winner in sight.

The person who started this "horse racing is a battle between the competitors and not against the house" advertising campaign, should be ashamed of himself.

When the "exotics" takeout is averaging at around 25%, the HOUSE becomes the player's most formidable competition....not the other players.


The concept of 'amongst ourselves' is just in theory because it doesnt really matter if a player thinks he's betting against the other players or the house, you hand the house money and they either give you back more than you started with or they give you nothing.

Good points.

[andymays]

The reason rwwupl started the thread is that yesterday we had one of our email things going on and he started it with a piece about rebates. there were other points going on in the exchanges as well.
------------------------------

One of the responses was from Jeff Platt. Here is an excerpt:

One thing you should know... In talking to those involved with the world's largest computer teams... volume-wise these teams EACH wager hundreds of millions of dollars per year... ALL repeat ALL of them have told me they favor 10%-12% takeout for all as opposed to 10% effective takeout for just them through rebates. Also, almost every smaller rebated player who I have spoken with (and I have spoken with hundreds) tells me the exact same thing.

Why?

They know lower takeout overall means more money wagered overall which means larger pools. Since they (the large computer syndicates) wager a set percentage of what they estimate final pool size to be, lower takeout overall means they will wager more than they currently wager now... which in turn means more total profits for them because their profit translates to a tiny percentage of their team's total handle.
-----------------------------------------------------------------------------------------------

[chickenhead]

If they didn't pay rebates they could lower the take right?

Rebates are solely a function of takeout and signal fees. Rebates don't dictate either of them, they are whats left over.

Tracks can eliminate rebates by lowering takeout. They can increase rebates by raising takeouts. Tracks can eliminate rebates by raising signal fees. Tracks can increase rebates by lowering signal fees.

Tracks control signal fees and takeout -- which gives them control over rebates. They control all the levers that control rebates. Takeout and signal fee are their levers -- part of the gap between them are rebates.

California tracks already have a small gap between signal fees and takeout. Rebates are relatively low on California tracks. They could quite easily eliminate rebates for everyone -- lower takeout and leave signal fees alone. Or raise signal fees and leave takeout alone.

They would lose distribution, either way, because there is a difference in how much different distributors need to make on that signal. One size doesn't fit all, that's why tracks leave some meat on the bone. The most efficient of those distributors will give some of that meat to the players, the least efficient will keep it, to fund their business. This is probably more than any other reason, why rebates will always exist in some form. There has to be meat on the bone, and the most efficient resellers will always give some of that to players, because that model works.

Anyway, if they wanted to reduce takeout -- and not lose distribution, they'd simply lower takeout and signal fees at the same time. The tracks have complete control, rebates don't get in their way in any way shape or form.

[proximity]

------------------------------

One of the responses was from Jeff Platt. Here is an excerpt:

... ALL repeat ALL of them have told me they favor 10%-12% takeout for all as opposed to 10% effective takeout for just them through rebates. Also, almost every smaller rebated player who I have spoken with (and I have spoken with hundreds) tells me the exact same thing.

-----------------------------------------------------------------------------------------------

and where in this statement are the "lame excuses to deny others" and the me first attitudes????

[andymays]

and where in this statement are the "lame excuses to deny others" and the me first attitudes????

I have no idea what you're talking about or what you're trying to imply.

The point is that in a perfect world there would be no rebates and we would have lower takeout. Is it going to happen? No.

[proximity]

I have no idea what you're talking about or what you're trying to imply.
.

in the first post of the thread mr way said:

Those players, who get an advantage through rebates, will fight to maintain their advantage, with lame excuses to deny others, but they know it is not right for the good or growth of the game, but like everything else in horse racing, the “Me First” attitude prevails.

however, the response you posted from mr platt, as well as my own posts on this thread seem to refute this notion.

[andymays]

in the first post of the thread mr way said:

Those players, who get an advantage through rebates, will fight to maintain their advantage, with lame excuses to deny others, but they know it is not right for the good or growth of the game, but like everything else in horse racing, the “Me First” attitude prevails.

however, the response you posted from mr platt, as well as my own posts on this thread seem to refute this notion.

I can't speak for rwwupl so he can answer if he chooses to.

I've made a couple of technically incorrect statements in this thread and there are obviously people who know more about them and how they work than me. The statement Chickenhead quoted would be one of them. Technichally incorrect on my part.

What Jeff said made sense to me. If you agree with his statement then we agree as well.

California players are under a different deal and that is where rwwupl is coming from.

[Indulto]

and where in this statement are the "lame excuses to deny others" and the me first attitudes????Prox,
How are you doing at Parx? ;)

It's one thing for rebated players to say they would like to see direct takeout lowered to match their effective takeout, and another for them to actually do something about it. Whales could force tracks to do that, but they don't. Why not? Because the rebate is a better deal for them.

rw has it right.

[Indulto]

Originally Posted by rwwupl
Of course the industry would be better off without them for a lot of reasons, and would enable the cost of the bet to be reduced to all players... and that is a good thing, because non- rebators are subsidizing rebate players now.Wrong. Please explain how rebates make it hard to lower takeout.

Rebates come from the ADW's margin. Removing rebates increases ADW margin. Removing rebates simply removes more money from the pools and puts it into the pockets of the ADW's. Lowering takeout decreases rebates because the ADW's are not going to accept anything below a certain percentage Margin, thus any takeout decrease comes out of the rebate.

Lowering takeout to the right level will eventually do away with the majority of rebates on it's own, and that's the only way to do it.C5,
Tracks are hooked on whale money. In a response to a Pricci column, Cary Fotias indicated that when whales were involved in a pool, 5% of players were responsible for 90% of handle. Tracks are not going to give that up, especially when they are struggling.

Fotias's coment inspired my idea for variable takeout and purses depending on individual pool handle to make popular/attractive betting events even more so while letting each group of participants in any pool fight it out on a level playing field regardless of what the takeout wound up being for that particular pool.

Since large fields would stimulate handle, and purses would also vary with handle, horsemen would be incentivized to run larger fields. (Perhaps as D6 suggested, the additional handle could fund purse distribution expansion to additional placings.)

[proximity]

Whales could force tracks to do that, but they don't. .

if the whales had that much influence they could just go to the track(s) directly to cut out the middlemen and get even better rebates for themselves. as an experiment you could try and do this yourself and see if you'll get a deal that can beat your adw rates. good luck with that.

i think you're giving whales too much credit.

[chickenhead]

Prox,
How are you doing at Parx? ;)

It's one thing for rebated players to say they would like to see direct takeout lowered to match their effective takeout, and another for them to actually do something about it. Whales could force tracks to do that, but they don't. Why not? Because the rebate is a better deal for them.

rw has it right.

The tracks need to believe that low takeout = more revenue, or else when faced with less revenue, like California, they'll raise takeout rather than lower it. Rebate players, playing, is actually the solidest evidence anyone can point to and say to the tracks "See, players respond to low rates in a positive fashion".

Like anything else, it's complicated. It's a tough sell to point to the people that have the lowest effective takeouts, and that they aren't playing (let's imagine they weren't) and say "see, you need to lower takeouts".

Conceptually, and as an argument -- having rebated players play, and non-rebated players not play -- should be the strongest and most obvious argument and evidence to show to a track that takeout needs to be lowered. That players do respond to their effective takeout. Having neither of them play, or having rebated players play less in proportion to non-rebated, would only seem to muddy the waters.

You have talked a lot about people that pay the full takeout leaving. That should be exactly the argument that carries the most force, and that would lead to a reduction in takeout. It's very understandable. It sucks that they carry the brunt of it, but economically they do, by decision of the tracks.

Non-rebated players leaving at a faster rate than rebated players is the actual evidence that argues for the reduction in takeout. It unfortunately has to continue (imo) until the tracks "get it".

Perhaps California has such a hard time "getting it" precisely because they haven't allowed rebates inside of California, and because of their fees allow for only very small rebates outside. There isn't much to point to about their patrons behavior to prove the point, there isn't much of a spread.

I wonder if any of the tracks, anywhere, keep track of their handle growth by effective takeout rate. i.e. we know what the handle curves look like overall, all burger. It would seem an obvious metric for a business to track, since their product is actually being sold at different prices -- what the actual +/- curve looks like over the years broken out at each individual price (to the bettor).

These things should be devastatingly obvious.

[Indulto]

The tracks need to believe that low takeout = more revenue, or else when faced with less revenue, like California, they'll raise takeout rather than lower it. Rebate players, playing, is actually the solidest evidence anyone can point to and say to the tracks "See, players respond to low rates in a positive fashion".

Like anything else, it's complicated. It's a tough sell to point to the people that have the lowest effective takeouts, and that they aren't playing (let's imagine they weren't) and say "see, you need to lower takeouts".

Conceptually, and as an argument -- having rebated players play, and non-rebated players not play -- should be the strongest and most obvious argument and evidence to show to a track that takeout needs to be lowered. That players do respond to their effective takeout. Having neither of them play, or having rebated players play less in proportion to non-rebated, would only seem to muddy the waters.

You have talked a lot about people that pay the full takeout leaving. That should be exactly the argument that carries the most force, and that would lead to a reduction in takeout. It's very understandable. It sucks that they carry the brunt of it, but economically they do, by decision of the tracks.

Non-rebated players leaving at a faster rate than rebated players is the actual evidence that argues for the reduction in takeout. It unfortunately has to continue (imo) until the tracks "get it".

Perhaps California has such a hard time "getting it" precisely because they haven't allowed rebates inside of California, and because of their fees allow for only very small rebates outside. There isn't much to point to about their patrons behavior to prove the point, there isn't much of a spread.

I wonder if any of the tracks, anywhere, keep track of their handle growth by effective takeout rate. i.e. we know what the handle curves look like overall, all burger. It would seem an obvious metric for a business to track, since their product is actually being sold at different prices -- what the actual +/- curve looks like over the years broken out at each individual price (to the bettor).

These things should be devastatingly obvious.Only on the planet Vulcan would such exquisite logic carry the day. Here on earth, and particularly in So Cal, we have to boycott.

Make it so, #1. :jump:

[Robert Fischer]

non- rebators are subsidizing rebate players now.
IF (although honestly i both haven't researched whether it happens, and Expect about a 98% probability of it currently happening based on the tracks greed and lack of insight) non- rebators are subsidizing rebate players now, I believe that this subsidization is because of perverted insight and improperly applied economics, rather than a necessary side effect of rebates. Do you disagree, or have any stance on this?? (I am only interested in direct subside for now, i.e. Knuckleheadz offer M.Dick a 10% rebate, so they then feel that in order to bring the "avg.Take" back up where "it belongs" they create the subsidizing economics.... What I argue for is as in post 31 (http://www.paceadvantage.com/forum/showpost.php?p=993467&postcount=31) an independant deal with the bigBettors based on marginalCosts and marginalRevenue )



[horseplaying] is not some kind of "man to man competition" mr way.
I substituted "horseplaying" for "handicapping" (which i am guessing was not a significant puposeful distinction)... - In fact, this game is exactly a "man to man competiion".

Does anyone think rebating has made it easier to raise the takeout over the last several years?
This is a good question. I think it is very important, although probably not for the reasons you were thinking;

1st rebating is a separate economic incentive for retaining the services of high-volume players. Because of the very low marginalCosts of taking 1-more(even 1 more large) wager, and the fact that it is FAR exceeded by even industry low takeout rates(marginalRevenue) thus leading to significant marginalProfit for each individual transaction(wager) which makes it a great thing for all involved - - [unless the math can somehow show that manipulation of the pool could be significant]
because people don't have the insight to know #1(above, what i just wrote), and people don't have the insight to teach it, - in other words we are pretty ignorant , and "WE"-may include the track's so called market experts and managerial seats in the industry, i don't know... there is lots of room for plain old ignorance as well as lies! It sure wouldn't be improbable for management to trade long-term growth for short term theivery by manipulating the public's ignorant perception of the rebate situation by painting a picture that rebates MUST be subsidized by non-rebators... eg. "the game needs the whales to survive, so we gotta raise takeout a few points to compensate for the avg... theres nothin that can be done folks :liar:"
Rebates are solely a function of takeout and signal fees. Rebates don't dictate either of them, they are whats left over.

Tracks can eliminate rebates by lowering takeout. They can increase rebates by raising takeouts. Tracks can eliminate rebates by raising signal fees. Tracks can increase rebates by lowering signal fees.

Tracks control signal fees and takeout -- which gives them control over rebates. They control all the levers that control rebates. Takeout and signal fee are their levers -- part of the gap between them are rebates.

California tracks already have a small gap between signal fees and takeout. Rebates are relatively low on California tracks. They could quite easily eliminate rebates for everyone -- lower takeout and leave signal fees alone. Or raise signal fees and leave takeout alone.

They would lose distribution, either way, because there is a difference in how much different distributors need to make on that signal. One size doesn't fit all, that's why tracks leave some meat on the bone. The most efficient of those distributors will give some of that meat to the players, the least efficient will keep it, to fund their business. This is probably more than any other reason, why rebates will always exist in some form. There has to be meat on the bone, and the most efficient resellers will always give some of that to players, because that model works.

Anyway, if they wanted to reduce takeout -- and not lose distribution, they'd simply lower takeout and signal fees at the same time. The tracks have complete control, rebates don't get in their way in any way shape or form.
have to read this all again after i eat to absorb it(the post, not the food...) but you strike me as someone who actually is focused almost completely on interpreting the truth. You don't seem to be set up at a pole with your barbed wire set up, crafting your truth to defend your position... seems like you are looking at things for what they are...
my hopes not too high though i still have to read these over. :ThmbUp:

[Robert Fischer]

The anti-rebate case has to be VERY STRONG.
BECAUSE we are dealing with (what are supposed to be)
actual living breathing markets (not these fixed corrupt rackets :mad: )
and in a real market where moneys are made from a flat takeout percentage out of the total pool monies bet,
it makes sense that players who bet more money are significantly more valuable to the market.




i'd like to see the math behind the 2 following possible introductions of a
rebate-like system




Any single wager over $100 would start to receive a pro-rated rebate depending on the amount. Example a $100 ticket could receive a 5% rebate(meaning that with 15% regular take it would be down to 10%, so if that wager cost the track 50cents and the revenue would be 10%of$100 or $10, and the marginalProfit $9.50)... it could be a sliding scale that gradually increases, rewarding large single tickets, and wouldn't require any players-cards or similar id outside of standard large betting requirements in order to get the rebates.
players-cards for those who wish to participate and get rebates... takeout starts at market-rate, and then once total amount churned reaches a certain amount, or when individual wagers eceed an amount (say $100, see #1above) rebates begin to take effect. The rebates are calculated to reward large betters "aka whales" as well as large individual wagers. This type of system could range from very gradual and general, or 3volve into being an extremely interactive system that adjusts to small market changes and constantly Rewards players with a very accurate takeout level according to the standard market's actual value and their level of contribution to the market.
http://www.bayoucaddyjubilee.com/img/players_card.jpg

[Indulto]

if the whales had that much influence they could just go to the track(s) directly to cut out the middlemen and get even better rebates for themselves. as an experiment you could try and do this yourself and see if you'll get a deal that can beat your adw rates. good luck with that.Maybe that's exactly what HANA VP, Mike Maloney, did at Keeneland.i think you're giving whales too much credit.I’d say it’s hard to underestimate the influence of even one person who’s average weekly volume is at least $20K. Collectively, they have even more. If direct takeout really was better for them, why wouldn't they get together and make it happen?

[Track Collector]

if the whales had that much influence they could just go to the track(s) directly to cut out the middlemen and get even better rebates for themselves. as an experiment you could try and do this yourself and see if you'll get a deal that can beat your adw rates. good luck with that.

i think you're giving whales too much credit.

Consider too the number of tracks you play. Spreading one's handle over many different tracks (personally my number is 45-50) reduces greatly the impact/leverage at any one track. One would also need to negotiate with all those tracks with that significantly reduced handle number.

This is why ADWs who specialize in rebates are successful. They can take the clout of numerous players playing many different tracks, and then the total handles have great leverage.

[proximity]

I substituted "horseplaying" for "handicapping" (which i am guessing was not a significant puposeful distinction)... - In fact, this game is exactly a "man to man competiion".


not in the context in which the thread starter presented it as being.

there are no "horseplayer" standings in the drf or sports section of your local newspaper. and the fact that i get a rebate on delta downs is not the same as giving me a head start in a cross country race, 3 balls and 4 strikes in a baseball game, or letting me hit from the red tees in golf.

i want california players to get rebates and i want them to be able to get rebates not only on their own sorry tracks, but also on the tracks i play. in fact i'd like them to get even better rebates than i'm getting. this could only help the pools. clearly this is different than giving them a head start or advantage in some kind of competition.

[proximity]

. Spreading one's handle over many different tracks (personally my number is 45-50) reduces greatly the impact/leverage at any one track. .

that is good to know because with the six groups of whales maxing out the charles town pools we may never get an overlay there again!!

and takeout is concerned about ct horseplayers not getting sodas from the cocktail waitresses!!

[proximity]

Maybe that's exactly what HANA VP, Mike Maloney, did at Keeneland.

that guy can't even get them to fix the tote system (the exploitation of which gives a real unfair advantage) and you want him to lower takeout?

[Indulto]

... You have talked a lot about people that pay the full takeout leaving. That should be exactly the argument that carries the most force, and that would lead to a reduction in takeout. It's very understandable. It sucks that they carry the brunt of it, but economically they do, by decision of the tracks.It's nice to get some positive feedback for a change.:jump:

Interestingly, when I bring this up to people, they don't start getting agitated until I pont out how the disparity affects them. IMO there must be an educational component involved in this boycott. Whether it's JP developing a spiel for talk show interviews (or you conducting seminars in Berzerkley ;)), there has to be a logical presentation explaining the disparity between the effective payoffs to rebated whales and unrebated bettors in dollars and cents.Non-rebated players leaving at a faster rate than rebated players is the actual evidence that argues for the reduction in takeout. It unfortunately has to continue (imo) until the tracks "get it".They won't "get it" until the unreabeted players do.Perhaps California has such a hard time "getting it" precisely because they haven't allowed rebates inside of California, and because of their fees allow for only very small rebates outside. There isn't much to point to about their patrons behavior to prove the point, there isn't much of a spread. ...They need to be educated as well.