Big Bettor Rebates: Case Made for High-Volume Betting Services

[TexasDolly]

In an article related to big bettor rebates a recent 5 day study at Beu. stated that of the 4.1 million handle some 20 % or ~820,000 was due to Elite and Rgb . It went on to say that the bettors lost ~41,000 straight up and received 137,000 in rebates. That means that they got rebates of ~ 17% of their handle. Doesn't that seem pretty high ? Or is the article in error ?

excerpt from the article on the front page of this site entitled "Case Made for High Volume Betting Services."
quote:
Basler used Beulah Park as an example. Over a recent five-day period the Ohio track handled $4.1 million on live races. RGS and Elite Turf Club, he said, accounted for 20% of the total handle; their players lost $41,000 straight up but made $137,000 through rebates.
Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jRhwoEHj

[toussaud]

I was going to ask this yesterday but is "high volume betting service" another word for rebate shop?

[FenceBored]

I was going to ask this yesterday but is "high volume betting service" another word for rebate shop?


It's an irregular declension:

I say 'high volume betting service;'
You say 'rebate shop;'
ExpressBet says 'parasitic enterprise with "no stake in the industry."'

[Ted Craven]

Not sure where you got 17% from, but it's too high (for pretty much everywhere). Try some numbers: if 10% average rebate, $1,370,000 daily handle attracts $137,000 in rebates. In this example, they could have lost $41,000 and recouped $137,000 for a net of $96,000. Higher rebate = smaller handle required. More WPS pool wagers = smaller rebate and higher handle required.

I think the straight profit/loss from wagering, on the one hand, and rebate earnings on the other hand, are distinct issues.

Ted

[TexasDolly]

Ted, They bet about 820,000 and recouped
137,000 ,that's how I calculated the 17 %
rebate. The article said they bet about 20%
of the 4.1 million handle over the 5 day period.
So maybe they were getting large rebates on exotics, but it did seem high to me.
TD

[Ted Craven]

TD,

OK, sorry, I went innumerate there for a moment. Yes, 17% seems a rather large increment over what I know is available for exotic pools at Beulah, especially since some of the money must have gone into lower % straight pools. I don't know ETC or RGS numbers, but I am familiar with AmWest and XpressBet's rebate schedules.

Maybe after $200 million a year handle, you get a toaster and a little something else.

Ted

[jelly]

None of the panelists offered insight into how domestic handle, which dropped about 5.5% in 2011 to under $11 billion, could grow.



Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jSJpeKW9

[Indulto]

None of the panelists offered insight into how domestic handle, which dropped about 5.5% in 2011 to under $11 billion, could grow.



Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jSJpeKW9"… Arkansas HBPA president Bill Walmsley disputed the claim that high-volume players don’t impact ontrack patrons. He said the horsemen’s group, with the blessing of Oaklawn Park Park, continues to keep high-volume shops out of the racetrack’s pools. …"

Good for Oaklawn Park!

I find it hard to believe the greatest potential for handle growth isn’t from new and existing players who wouldn’t qualify for rebates; or that there would be significant handle growth among whales without greater liquidity in the pools.

How about a compromise?

Experiment wit lower direct takeout and NO rebates on Saturdays AND on ANY wagers involving a Graded Stakes race ANYTIME. Let the new fan compete on a level playing field and give non-whale handle a chance to grow.

[PaceAdvantage]

PLENTY of non-whales have access to rebates.

You don't need to be a whale to sign up for IdaBet (https://www.idabet.com/breeders_bonus.php?promo=1), a sponsor here, or Premier Turf Club (http://www.betptc.com/), another sponsor here.

They may not be available to YOU because of where you live, but they are available to A LOT of non-whales across the USA.

[FenceBored]

PLENTY of non-whales have access to rebates.

You don't need to be a whale to sign up for IdaBet (https://www.idabet.com/breeders_bonus.php?promo=1), a sponsor here, or Premier Turf Club (http://www.betptc.com/), another sponsor here.

They may not be available to YOU because of where you live, but they are available to A LOT of non-whales across the USA.

Those are addressed in the article. They're the ones the ExpressBet exec highlighted:
“They’re getting 10%-12% of takeout for $200,000-a-year players,” Luniewski said. “The ‘micros’ are offering players much more. These are people who may have no stake in the industry.”
Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jTIIKvOJ

[PaceAdvantage]

Those are addressed in the article. They're the ones the ExpressBet exec highlighted:
“They’re getting 10%-12% of takeout for $200,000-a-year players,” Luniewski said. “The ‘micros’ are offering players much more. These are people who may have no stake in the industry.”
Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jTIIKvOJ


How do they have no stake in the industry? If the industry goes away, they go out of business. For starters...

[TexasDolly]

PTC and IDA commingle their funds as I understand it , so they have done their share it would seem to me.
TD

[FenceBored]

How do they have no stake in the industry? If the industry goes away, they go out of business. For starters...

They're not affiliated with a track. Since they aren't affiliated with a track or a horseman's group, they're bad people. We should all do our part by shunning them. Right? :confused:

[PaceAdvantage]

They're not affiliated with a track. Since they aren't affiliated with a track or a horseman's group, they're bad people. We should all do our part by shunning them. Right? :confused:Surely you jest...

[thespaah]

It's an irregular declension:

I say 'high volume betting service;'
You say 'rebate shop;'
ExpressBet says 'parasitic enterprise with "no stake in the industry."'
Expressbet management can whine all they like. What they are pissed about is the fact that bettors like any other consumer are going to shop for the best price and value for their money.
The idea is for ALL ADW's to look at being competitive in the marketplace.
Now, I without knowing specifics, I can guess there is the existence of certain laws and regulations that limit rebates from ADW's and not others.
Those need to be wiped away.

[thespaah]

Those are addressed in the article. They're the ones the ExpressBet exec highlighted:
“They’re getting 10%-12% of takeout for $200,000-a-year players,” Luniewski said. “The ‘micros’ are offering players much more. These are people who may have no stake in the industry.”
Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jTIIKvOJ



this I don't believe for a fifth of a second..
Terry and others contended that high-volume players don’t cause late odds changes in win pools. At RGS, where 60% of the wagering is done robotically

Read more: http://www.bloodhorse.com/horse-racing/articles/66960/case-made-for-high-volume-betting-services#ixzz1jTY84uF1

Terry and others contended that high-volume players don’t cause late odds changes in win pools.
I have eyes. We all do. I have seen WPS pools literally DOUBLE in the last few flashes on the tote board. No one is going to convince me that this is not on line money coming from big bettors.

[Indulto]

PLENTY of non-whales have access to rebates.

You don't need to be a whale to sign up for IdaBet (https://www.idabet.com/breeders_bonus.php?promo=1), a sponsor here, or Premier Turf Club (http://www.betptc.com/), another sponsor here.

They may not be available to YOU because of where you live, but they are available to A LOT of non-whales across the USA.What does a "A LOT" mean? :confused:

Do you even have percentages to back up that statement? Can they take CA, NY, NJ, and KY residents and their local tracks? What % of total players do those residents combined with customers of those tracks represent?

Was that an analysis intended as part of a rebuttal or was it supplemental advertising? ;)

[cj]

What does a "A LOT" mean? :confused:

Do you even have percentages to back up that statement? Can they take CA, NY, NJ, and KY residents and their local tracks? What % of total players do those residents combined with customers of those tracks represent?

Was that an analysis intended as part of a rebuttal or was it supplemental advertising? ;)

I'm sure you can find the answers to all those questions, except of course the last one, just as easily as PA can.

[Ted Craven]

Everyone who places a conditional wager scheduled for 0 MTP or -1 MTP, whether betting $10 or betting 200 combos totalling $2000, whether via a high-volume shop like ETC or RGS or a major like ExpressBet, or via so called micro-ADWs like AmWest or BetPTC or IdaBet - all of these scenarios will result in money coming in at the last tick, not just whales, though large bettors surely make up the bulk.

But if the Beulah study cited is reflective of the general situation - these big bettors bet $820,000 to lose $41,000 or 5%. I know it sometimes feels like those last minute odds drops affects only my horse which I bet at 4-1, but the truth is that some odds go down and some go up. One could argue that to a significant extent, these losing bettors (i.e. losing 5% to gain 17%, or whatever) are playing 'market maker' putting liquidity into the pari-mutuel pools, floating a large number of boats, so to speak (or betting interests in a race).

Isn't this a good thing - raising handle? Maybe it's not a lot - yet - but don't these shops, including the micro-ADWs - also provide a useful conduit for bettors based outside North America to put $$$ into North American racing, i.e. directly into comingled pools, purses and horsemen's pockets?

While it's a truth that the more you bet, the bigger the rebates, its also mistake to think that the spread between the rebates offered the $10,000 a year bettor and the $1,000,000 bettor is more than a couple of points.

Ted

[Ted Craven]

What does a "A LOT" mean? :confused:

Do you even have percentages to back up that statement? Can they take CA, NY, NJ, and KY residents and their local tracks? What % of total players do those residents combined with customers of those tracks represent?

Every resident of every US State except Alaska, Arizona, District of Columbia, Georgia, Hawaii, Kansas, Missouri, Mississippi, Nebraska, New Jersey, North & South Carolina, Texas, Utah and Virginia.

Residents of California betting a certain volume.

Residents of most other countries on the planet (except Canada, and a few other strange places ...)

Most Thoroughbred, Quarterhorse, Harness and dog tracks.

Ted

[PaceAdvantage]

What does a "A LOT" mean? :confused:

Do you even have percentages to back up that statement? Can they take CA, NY, NJ, and KY residents and their local tracks? What % of total players do those residents combined with customers of those tracks represent?

Was that an analysis intended as part of a rebuttal or was it supplemental advertising? ;)What are you even asking?

Unless idabet or ptc or any other "rebate shop" explicitly states "someone from state xyz can't join," that means everyone from every state that isn't legally prevented from signing up has the opportunity to do so.

Here is the disclaimer from PTC for instance:

Our wagering service is available to individuals 18 years of age and older that reside in an eligible state. Residents of the following states are currently ineligible to sign up for our service: Alaska, California, District of Columbia, Georgia, Hawaii, Mississippi, Nevada, New Jersey, North Carolina, South Carolina, Texas, Virginia, and Utah.That leaves a helluva lot of people eligible to sign up and enjoy rebates. Not sure why this needs to be explained to you...it should have been more than obvious.

[FenceBored]

Surely you jest...

Of course I do, and don't call me Shirley.

[Indulto]

Every resident of every US State except Alaska, Arizona, District of Columbia, Georgia, Hawaii, Kansas, Missouri, Mississippi, Nebraska, New Jersey, North & South Carolina, Texas, Utah and Virginia.

Residents of California betting a certain volume.

Residents of most other countries on the planet (except Canada, and a few other strange places ...)

Most Thoroughbred, Quarterhorse, Harness and dog tracks.

TedTC,
Thanks for responding.

Is it possible to acquire meaningful estimates of

1) the percentage of existing players that currently receive rebates,
2) the percentage of total handle on which rebates are currently paid at some rate,
3) the revenue generated to to fund purses and operations from rebated handle,
4) the revenue generated from the remainder of total handle that isn't rebated,
5) the lowest direct takeout rate in lieu of rebates that would generate the same current revenue
6) the percentage of total handle attribut to each track,
7) the pecentage of individual track handle that is rebated among tracks offering a graded stakes race?


Are there any other posters on this board willing to consider whether lower direct takeout for all might be a viable option for increasing overall handle and revenue, or is everybody's mind already made up here?

[TexasDolly]

I am very much in favor of lower takeout for all. I am not sure if it would make up for the whale money initially but long term it might provide more revenue than the alternative of losing the smaller bettors. I also wonder if the lower takeout wouldn't allow a number of the whales to continue to play ,after all, they apparently are close to breakeven(-5%) without the rebates now.
TD

[cj]

Are there any other posters on this board willing to consider whether lower direct takeout for all might be a viable option for increasing overall handle and revenue, or is everybody's mind already made up here?

I've said all along that would be best, and I don't remember many others saying differently. Most just realize with the people in charge most places and the amount of government involvement in the game, it isn't likely to happen any time soon.

[Indulto]

I've said all along that would be best, and I don't remember many others saying differently. Most just realize with the people in charge most places and the amount of government involvement in the game, it isn't likely to happen any time soon.Saying it, and being wiling to work to achieve it, are two different things.

If the status quo doesn’t affect you adversely, I can understand your apathy, but aren't you at all concerned with the lack of transparency associated with the practice that prevents access to the type of information I suggested might be helpful in evaluating its impact?

[Robert Goren]

Every resident of every US State except Alaska, Arizona, District of Columbia, Georgia, Hawaii, Kansas, Missouri, Mississippi, Nebraska, New Jersey, North & South Carolina, Texas, Utah and Virginia.

Residents of California betting a certain volume.

Residents of most other countries on the planet (except Canada, and a few other strange places ...)

Most Thoroughbred, Quarterhorse, Harness and dog tracks.

TedThere are sites that will take Nebraska residents and offer rebates to them, but most do not. We have a law that the wording leaves some room for interpretation. The intent of the framers of the laws is not. They wanted to ban Nebraska residents from betting horses online. They just screwed up the language.

[IdaBet.com]

Obviously all ADW's have a stake in the industry as they provide betting income to every track and thus the purses and breeders fund. ADW's as mentioned are the only growth area of the sport allowing more people to wager than ever before.

Idabet.com operates its own racetrack, Sandy Downs in Idaho. Sure it's not a major track, but it supports live racing in Idaho and works together with Les Bois to promote the entire racing business in the state.

In fact, if not for wanting to grow live racing, Idabet.com would not be around. We are one ADW that believes both live racing and the growth of off track are necessary for racing to survive.

[Dave Schwartz]

IMHO, the simple fact that an ADW chooses to have a presence among horse players here on PA indicates a willingness to listen to the customer that is missing in most of the industry as a whole.

https://idabet.com/ deserves :ThmbUp: :ThmbUp:


Regards,
Dave Schwartz

[Indulto]

Excessively high levels of direct takeout enables bet takers to profitably exploit the excess charges by offering their customers a discount at the expense of players forced to pay full price for the product. Without the latter’s contribution to purses and operations, the comparatively miniscule contribution toward those expenses by high volume bettors would not be practical.

Those negatively impacted by the favorable treatment of such players would appear to be those responsible for 80% of handle according to the article. Even if that 80% includes handle from bettors discounted to a lesser extent by “micro” and other ADWs, it inhibits growth of total handle from new players and those willing to pay full-price that would likely occur if everyone paid a lower price directly.

People profiting from the status quo can be expected to continue painting a positive picture of rebating, but a "photograph" of the situation shows decreasing handle and fading popularity of the game because the playing field isn’t level. So when PA attributed my dissatisfaction to the fact that I live in a state where available rebates are tied to volume, he misrepresented -- perhaps unintentionally -- my motivation for challenging the status quo. It is not just that I wish to lower the price I pay for the product, but also that I want to see the game preserved and its popularity expanded.

[cj]

Saying it, and being wiling to work to achieve it, are two different things.

If the status quo doesn’t affect you adversely, I can understand your apathy, but aren't you at all concerned with the lack of transparency associated with the practice that prevents access to the type of information I suggested might be helpful in evaluating its impact?
yes, I hate that it is a big secret. However, I've got one kid done with college, another there now, and one more there soon. Maybe after they are done I'll have more time to devote to non-paying causes, but that isn't happening right now, sorry.

[cj]

While I agree lower takeout for all is ideal, I disagree that those not getting a rebate are at a big disadvantage. Without the money from rebate players, most pools would be too small for anyone to bet seriously. I personally am happy the whale money is there.

[Dave Schwartz]

Excessively high levels of direct takeout enables bet takers to profitably exploit the excess charges by offering their customers a discount at the expense of players forced to pay full price for the product.

Indulto,

Why don't you sing this song to the airline industry where they charge $200 for a seat and the guy next to it is paying $800 for the same trip?

How about the guy who buys 50,000 square feet of carpet for his mansion. Is it wrong that he should get a better deal than you in your 2,000 square foot home?

Volume buyers get a break at just about everything. It is how the capitalistic system works.

Now, don't get me wrong. IMHO, the whales have made the game more difficult to beat and, therefore, not as positive an experience for the majority of players.

But you are preaching to the choir. I don't think anyone here thinks that the takeouts should not be lowered.


Dave Schwartz

[PaceAdvantage]

So when PA attributed my dissatisfaction to the fact that I live in a state where available rebates are tied to volume, he misrepresented -- perhaps unintentionally -- my motivation for challenging the status quo.I did nothing of the sort sir! What I did was directly answer your question as to my use of the phrase "A LOT," and prior to that, directly countered your continued claim that rebates are somehow something only a very select few are able to take advantage of...

Perhaps that was the case years ago, but today, not so much...

[ronsmac]

While I agree lower takeout for all is ideal, I disagree that those not getting a rebate are at a big disadvantage. Without the money from rebate players, most pools would be too small for anyone to bet seriously. I personally am happy the whale money is there.
If the statistics are true, that whale money is making up 20% of some pools at and avg loss of 5 or 6 %, with an avg takeout of 20% or so, The whales are in a sense making the takeout higher for all other players. With that said, they have a right to bet like anyone else. Every player should bet with a rebate. I'm actually confused why anyone bets without one.

[Robert Goren]

If the statistics are true, that whale money is making up 20% of some pools at and avg loss of 5 or 6 %, with an avg takeout of 20% or so, The whales are in a sense making the takeout higher for all other players. With that said, they have a right to bet like anyone else. Every player should bet with a rebate. I'm actually confused why anyone bets without one.The average Joe who goes to the track a few times a year is not ever going to get one. The First timer isn't ever going to get one. The industry needs both of these bettors badly, but they screw them over as best they can. The industry attitude is seems to screw as many people as they can and cut a deal only when someone is threatening not to bet anymore. No wonder the number of small bettors is rapidly declining. They have no leverage in an industry that would rather live off slot money than have a workable business model.

[PaceAdvantage]

The average Joe who goes to the track a few times a year is not ever going to get one. The First timer isn't ever going to get one. The industry needs both of these bettors badly, but they screw them over as best they can. The industry attitude is seems to screw as many people as they can and cut a deal only when someone is threatening not to bet anymore. No wonder the number of small bettors is rapidly declining. They have no leverage in an industry that would rather live off slot money than have a workable business model.Really? The industry needs the average Joe who bets comparatively nothing and the first timer who really bets nothing over the whales who bet TONS?

That makes no sense.

And why can't the average Joe get a rebate? I'm not a whale. I can get a rebate.