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Maybe some tracks are losing money but sources say there are definitely less horse bettors but those betting are wagering more.
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I think a lot of that is attributable to whale betting, and was discussed at the recent Jockey Club Round Table.
http://jockeyclub.com/default.asp?se...ar=2018&area=4
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A third but related shift is the growth of computer-assisted wagering, which is professional bettors using computer algorithms and automated bet placement software to place their bets. This activity has almost doubled in the past seven years at five tracks that McKinsey looked at and is now estimated to be between 16 to 19% of all handle.
Many experts that McKinsey spoke to believe that this growth has a natural limit, which they put at about 20% of overall handle.
You see, computer wagering players don't want to bet just against each other. They need recreational players in the pool to be profitable and continue betting. So we may be nearing the limits of the growth of the computer wagering that we've seen over the past seven years. If so, overall handle will decline again in the future, unless racing can grow to recreational bettors.
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So from 2005-2011, overall handle was in a tailspin, dropping an average of -4.65% per year. From 2012 to present, that's leveled off, and handle has either remained steady or slightly increased (average increase of 0.22% per year).
Source:
http://www.jockeyclub.com/default.asp?section=FB&area=8
I think there's a direct correlation between those numbers leveling off, and the rise of robobetting that started around the same time. The whales have effectively stopped the bleeding, but in doing so have covered up the fact that average bettors are still dying off, or walking away, and aren't being replaced. Meanwhile the industry is content to take their quarter-point increase in handle every year, and pretend that everything is fine.
But as McKinsey points out, the whales can only bet so much before they hit a point of diminishing returns, and they're very nearly there. Once they hit that wall - and coupling that with competition from sports betting - I think we see handle numbers start to drop again, which will set off a domino effect that will cause the contraction that racing has desperately needed. I expect to see a lot of tracks closing their doors over the next decade.
