Crist and Beyer lay into NYRA and Stronach for having financial interests in CAW's

[Poindexter]

Originally Posted by dilanesp

I think that thinking in the short term is a malady that plagues business generally and is not unique to horse racing.

I don't know if you saw, but I responded to your individual points in the quote part of my last post. I have yet to learn how to quote small parts of a post in my posts so I respond the best way I can. I might have to stop making my fantasy land posts if I take 10 minutes and learn how to quote part of a post. Can't have that. As far as whether it is rare or common, the cat is out of the bag now. I can't imagine too many horse players (with all the information that has come out) do not know they are getting fleeced. I really don't see how racing has any choice in the matter but to do the right thing and at the very least correct pricing. The lower the takeout, the lower the rebates. They are already sort of baby stepping to reduced takeout. 10% pools here, 12% pools there. It is clear as day the current pricing is off the charts too high. This tip toeing in the right direction without correcting the problem is futile, however. As a horse player I applaud it, because it give me more opportunities. But ultimately it is going to lead them to reducing takeout with little to no benefits.

They have to fix the entire market's pricing, not this pool here and that pool there. When they fix the market they need to have a big coming out party. At that point the "smart" people can show us how smart they really are and effectively market this sport to a country full of gamblers

Ok enough fantasy land.

[lamboguy]

rebates are paid in different tier levels, the more you play, the higher the rebate rates.

A good CAW player can beat the game strictly with the access to the pools, the rebate is the bonus. there is a such thing as a sub par CAW player, that actually have lost, went broke and are out of the game now. what we are seeing now are only the stronger CAW operations with higher implications on wagering pools. they have very strong data bases and models and can take advantage of inequities in pools that all of can't.

now please remember that Sportsbook do everything to thwart Robo players, they are the same thing in sports as what CAW are in horse racing. in many cases the Robo players make better lines than the lines that Sportsbooks use to run their business.

[Andy Asaro]

Originally Posted by lamboguy

rebates are paid in different tier levels, the more you play, the higher the rebate rates.

A good CAW player can beat the game strictly with the access to the pools, the rebate is the bonus. there is a such thing as a sub par CAW player, that actually have lost, went broke and are out of the game now. what we are seeing now are only the stronger CAW operations with higher implications on wagering pools. they have very strong data bases and models and can take advantage of inequities in pools that all of can't.

now please remember that Sportsbook do everything to thwart Robo players, they are the same thing in sports as what CAW are in horse racing. in many cases the Robo players make better lines than the lines that Sportsbooks use to run their business.

And if they got no rebates and takeout were lowered for everyone what then? After all they have a skill, technology, and bankroll edge.

[o_crunk]

The primary customer of horse racing these days is state governments. Racing has to prove they are a viable and popular business worth supporting with tax dollars. This is why places like Saratoga and Monmouth make up their attendance numbers ("We had more people come to our facilities than the New York Knicks did!"). It's also why handle is important ("We took billions of dollars of bets on our races last year. The public must like it").

The bottom line is that racing as a betting proposition is simply a non-starter for the majority of the public sans 4 or 5 days a year. There are more people on the 42nd street subway platforms at this very moment than who are going to place a bet on a race in Tuesday in December. You can market a nice a day out at the track (and they have!) but that's about it. When it comes down to the bet, any Joe Blow betting serious money on something has a ton of options now compared to 20 years ago. It's going to be very hard to just say "if we lower rake, people will come". No they will not come with just that alone so all you people in this thread better sharpen your pencils with something more than that.

I'm against the mega rebates. It eventually puts the industry in a place where they can't return from. I'm for radical transparency on rebates. Publish them. If some group wants to bet hundreds of millions a year, they should get a discount like any other business. But I'm under no illusion that if you do this, it does anything for racing's business. A lot of what's discussed as a solution here is fantasy. At the end of the day, "racing" is subject to the whims of state governments. Close to half of the purses distributed this year in T-bred races in this country come from sources other than handle. The sad truth is, the customer is the government, not Joe Blow playing $200 at Parx. To switch that scenario around, you'd need hundreds of thousands of people engaged at the Joe Blow level to turn the tide. Simply lowering rake isn't going to do it, though it must be part of it. So you're going to need more solutions than that.

CRW is a symptom of a failing business, it's not a cause of the failing business. If you turn it off, handle goes way, way down. And that's one less selling point to the real customer - the government.

[Andy Asaro]

Originally Posted by o_crunk

The primary customer of horse racing these days is state governments. Racing has to prove they are a viable and popular business worth supporting with tax dollars. This is why places like Saratoga and Monmouth make up their attendance numbers ("We had more people come to our facilities than the New York Knicks did!"). It's also why handle is important ("We took billions of dollars of bets on our races last year. The public must like it").

The bottom line is that racing as a betting proposition is simply a non-starter for the majority of the public sans 4 or 5 days a year. There are more people on the 42nd street subway platforms at this very moment than who are going to place a bet on a race in Tuesday in December. You can market a nice a day out at the track (and they have!) but that's about it. When it comes down to the bet, any Joe Blow betting serious money on something has a ton of options now compared to 20 years ago. It's going to be very hard to just say "if we lower rake, people will come". No they will not come with just that alone so all you people in this thread better sharpen your pencils with something more than that.

I'm against the mega rebates. It eventually puts the industry in a place where they can't return from. I'm for radical transparency on rebates. Publish them. If some group wants to bet hundreds of millions a year, they should get a discount like any other business. But I'm under no illusion that if you do this, it does anything for racing's business. A lot of what's discussed as a solution here is fantasy. At the end of the day, "racing" is subject to the whims of state governments. Close to half of the purses distributed this year in T-bred races in this country come from sources other than handle. The sad truth is, the customer is the government, not Joe Blow playing $200 at Parx. To switch that scenario around, you'd need hundreds of thousands of people engaged at the Joe Blow level to turn the tide. Simply lowering rake isn't going to do it, though it must be part of it. So you're going to need more solutions than that.

CRW is a symptom of a failing business, it's not a cause of the failing business. If you turn it off, handle goes way, way down. And that's one less selling point to the real customer - the government.

All great points.

Lowering take on hi churn wagers has to be accompanied by an all hands on deck gambling game of skill marketing strategy. For whatever reason racing wants to stick to the tried and true fail as slowly as possible strategy of selling it as entertainment

Nobody should get rebates if the point is to grow the game/sport. Pricing should be optimal and low for the novice and the experienced high volume gambler.

[lamboguy]

if you take away the rebates and lower the takeout, the CAW will get more money than with the rebates. simply put, there will be more money out there for the CAW to put their claws on and extract it from more people.

[Redboard]

One surefire way to get rid of the CAWs is to have all pools blind. What you would put on the tote would be the morning lines, that’s all you’d see, nothing would change as betting continued, but here would be the difference. If according to an industry spokesman:

“CAWs actually have an advantage. They have spent a lot of money, time, and brain power developing a very powerful tool for analyzing races. One that requires constant tinkering and endless inputting of data. They have used advanced regression ( at the very least ) analysis to identify and weigh many more variables than likely any of us come close to looking at.”

Then the tracks should get these powerful algorithms to produce their morning lines. Now you might say, if I look up at the tote and it’s not changing, how do I know what my payout is going to be? Well, you don’t really know what your payout is going to be anyway, do you? Not until the payouts are posted after the race. The payouts would still be pari-mutual, so the track would never lose.

When you think of it, when you bet $2 on a horse to win, that “information” is processed and displayed on the tote. Is that fair? Shouldn't that be private?

[AndyC]

Originally Posted by Redboard

One surefire way to get rid of the CAWs is to have all pools blind. What you would put on the tote would be the morning lines, that’s all you’d see, nothing would change as betting continued, but here would be the difference. If according to an industry spokesman:

“CAWs actually have an advantage. They have spent a lot of money, time, and brain power developing a very powerful tool for analyzing races. One that requires constant tinkering and endless inputting of data. They have used advanced regression ( at the very least ) analysis to identify and weigh many more variables than likely any of us come close to looking at.”

Then the tracks should get these powerful algorithms to produce their morning lines. Now you might say, if I look up at the tote and it’s not changing, how do I know what my payout is going to be? Well, you don’t really know what your payout is going to be anyway, do you? Not until the payouts are posted after the race. The payouts would still be pari-mutual, so the track would never lose.

When you think of it, when you bet $2 on a horse to win, that “information” is processed and displayed on the tote. Is that fair? Shouldn't that be private?

The best way to neutralize the CAWs is to make all pools visible!

[castaway01]

Originally Posted by o_crunk

The primary customer of horse racing these days is state governments. Racing has to prove they are a viable and popular business worth supporting with tax dollars. This is why places like Saratoga and Monmouth make up their attendance numbers ("We had more people come to our facilities than the New York Knicks did!"). It's also why handle is important ("We took billions of dollars of bets on our races last year. The public must like it").

The bottom line is that racing as a betting proposition is simply a non-starter for the majority of the public sans 4 or 5 days a year. There are more people on the 42nd street subway platforms at this very moment than who are going to place a bet on a race in Tuesday in December. You can market a nice a day out at the track (and they have!) but that's about it. When it comes down to the bet, any Joe Blow betting serious money on something has a ton of options now compared to 20 years ago. It's going to be very hard to just say "if we lower rake, people will come". No they will not come with just that alone so all you people in this thread better sharpen your pencils with something more than that.

I'm against the mega rebates. It eventually puts the industry in a place where they can't return from. I'm for radical transparency on rebates. Publish them. If some group wants to bet hundreds of millions a year, they should get a discount like any other business. But I'm under no illusion that if you do this, it does anything for racing's business. A lot of what's discussed as a solution here is fantasy. At the end of the day, "racing" is subject to the whims of state governments. Close to half of the purses distributed this year in T-bred races in this country come from sources other than handle. The sad truth is, the customer is the government, not Joe Blow playing $200 at Parx. To switch that scenario around, you'd need hundreds of thousands of people engaged at the Joe Blow level to turn the tide. Simply lowering rake isn't going to do it, though it must be part of it. So you're going to need more solutions than that.

CRW is a symptom of a failing business, it's not a cause of the failing business. If you turn it off, handle goes way, way down. And that's one less selling point to the real customer - the government.

Brilliant post, one of the best I've ever seen on this topic. You nailed the myriad of problems racing faces.

[Poindexter]

Originally Posted by o_crunk

The primary customer of horse racing these days is state governments. Racing has to prove they are a viable and popular business worth supporting with tax dollars. This is why places like Saratoga and Monmouth make up their attendance numbers ("We had more people come to our facilities than the New York Knicks did!"). It's also why handle is important ("We took billions of dollars of bets on our races last year. The public must like it").

The bottom line is that racing as a betting proposition is simply a non-starter for the majority of the public sans 4 or 5 days a year. There are more people on the 42nd street subway platforms at this very moment than who are going to place a bet on a race in Tuesday in December. You can market a nice a day out at the track (and they have!) but that's about it. When it comes down to the bet, any Joe Blow betting serious money on something has a ton of options now compared to 20 years ago. It's going to be very hard to just say "if we lower rake, people will come". No they will not come with just that alone so all you people in this thread better sharpen your pencils with something more than that.

I'm against the mega rebates. It eventually puts the industry in a place where they can't return from. I'm for radical transparency on rebates. Publish them. If some group wants to bet hundreds of millions a year, they should get a discount like any other business. But I'm under no illusion that if you do this, it does anything for racing's business. A lot of what's discussed as a solution here is fantasy. At the end of the day, "racing" is subject to the whims of state governments. Close to half of the purses distributed this year in T-bred races in this country come from sources other than handle. The sad truth is, the customer is the government, not Joe Blow playing $200 at Parx. To switch that scenario around, you'd need hundreds of thousands of people engaged at the Joe Blow level to turn the tide. Simply lowering rake isn't going to do it, though it must be part of it. So you're going to need more solutions than that.

CRW is a symptom of a failing business, it's not a cause of the failing business. If you turn it off, handle goes way, way down. And that's one less selling point to the real customer - the government.

I will take your points at face value. I don't agree with everything but my points have been made plenty of times. Seems strange to me that racing can get charity sans audit of books, but given the intelligence of the typical politician, doesn't surprise me.

So your point is that the Caw has to be in the game like they are. A 20% reduction in handle initially is off the table because it will jeopardize future charity and what is life without charity. So if the top caw are currently getting around 16 % rebates on a 22% pool (that is my estimate) than if Racing cut takeout across the board to 10%, they would be in the same place with a 5% rebate to the caw. So with a takeout of 10% and a rebate of 5 % the Caw still bet 35% of the pool, this time around they are working at about break even and working on the 5% rebate. $100,000 pool, 10 percent takeout, or $10,000 takeout on $65,000 of public money bet or the public will lose at a 15.4% clip rather than a 26 to 28% clip. Caw would be betting just as much, some of the public would stay in the game and the game while still very difficult, will become beatable to some. Non caw will start to stay in the game and drive up handle rather than leave the game at an accelerating rate and caw can bet more as the public bets more. So while it would not work as good as no rebates it would still give the public a fighting chance and make the game a lot more sustainable. Effective marketing would give the game some kind of hope. Please explain to me why this idea is fantasy.

From a personal level I can't beat the game long term now, but I do think I might be able to beat it if there was a 10% takeout and rebates were limited to 5%. I certainly would bet a lot more money than I currently do.

[drib]

Originally Posted by lamboguy

rebates are paid in different tier levels, the more you play, the higher the rebate rates.

A good CAW player can beat the game strictly with the access to the pools, the rebate is the bonus. there is a such thing as a sub par CAW player, that actually have lost, went broke and are out of the game now. what we are seeing now are only the stronger CAW operations with higher implications on wagering pools. they have very strong data bases and models and can take advantage of inequities in pools
now please remember that Sportsbook do everything to thwart Robo players, they are the same thing in sports as what CAW are in horse racing. in many cases the Robo players make better lines than the lines that Sportsbooks use to run their business.

This is incorrect. CAW's make their profit from rebates (10% or higher). Whether they actually show a profit is meaningless. Consider this: If u r getting a 10% rebate, would u rather use a system that wagers say $100k/day and shows a profit of say 2% or use a system that can bet $1 mil/day and loses 5%? In the history of parimutuel wagering, no entity has ever managed to bet most every race every day at almost every track and shown any profit close to 10%. The CAW's deserve credit for developing approaches that can plow in millions, and come close to break even, but make no mistake, rebates are the key. Take them away and CAW's disappear.

[drib]

Originally Posted by drib

This is incorrect. CAW's make their profit from rebates (10% or higher). Whether they actually show a profit is meaningless. Consider this: If u r getting a 10% rebate, would u rather use a system that wagers say $100k/day and shows a profit of say 2% or use a system that can bet $1 mil/day and loses 5%? In the history of parimutuel wagering, no entity has ever managed to bet most every race every day at almost every track and shown any profit close to 10%. The CAW's deserve credit for developing approaches that can plow in millions, and come close to break even, but make no mistake, rebates are the key. Take them away and CAW's disappear.

I would add the controversy arises b/c tracks as tote company and simo outlet owners (getting a % of action) have given CAW exclusive advantages available to no one else. The most obvious and easy to understand is the ability to bet hundreds of combinations in a millisecond while everyone else restricted to 3 bets/sec. When it comes to these super jackpot must pays, CAW's are only entities actually able to play hundreds of thousands of tickets using up to date info. No surprise their success rate here has been astounding.

[MJC922]

Originally Posted by drib

This is incorrect. CAW's make their profit from rebates (10% or higher). Whether they actually show a profit is meaningless. Consider this: If u r getting a 10% rebate, would u rather use a system that wagers say $100k/day and shows a profit of say 2% or use a system that can bet $1 mil/day and loses 5%? In the history of parimutuel wagering, no entity has ever managed to bet most every race every day at almost every track and shown any profit close to 10%. The CAW's deserve credit for developing approaches that can plow in millions, and come close to break even, but make no mistake, rebates are the key. Take them away and CAW's disappear.

Take rebates away and they stop betting everything down to break even. That doesn't stop them from winning. Nobody should be trying to prevent them from winning or keeping their money out of the pools. Let them start showing +ROI profits without rebates the way everyone else needs to. They're fully capable of that. Would the bottom line profit be less? Maybe... but that shouldn't be a concern of anyone who cares about a level playing field, especially after a reasonable tapering off period is agreed upon. It's just too fundamentally wrong to allow this stuff to go on indefinitely IMO. It's the pool and the takeout and it should be considered off limits for anyone to be compromising and striking deals with that. If they want to give them limo service, free food, hotels whatever other comps someone can dream up that aren't monetary then go right ahead but this significant takeout reduction 'kickback' relative to the general public at large is fundamentally wrong IMO.

[Poindexter]

Originally Posted by drib

This is incorrect. CAW's make their profit from rebates (10% or higher). Whether they actually show a profit is meaningless. Consider this: If u r getting a 10% rebate, would u rather use a system that wagers say $100k/day and shows a profit of say 2% or use a system that can bet $1 mil/day and loses 5%? In the history of parimutuel wagering, no entity has ever managed to bet most every race every day at almost every track and shown any profit close to 10%. The CAW's deserve credit for developing approaches that can plow in millions, and come close to break even, but make no mistake, rebates are the key. Take them away and CAW's disappear.

If takeout went to 10% across the board and the CAW was given a 5% rebate, why would they disappear? They would be betting into a net 5% takeout. Right now if they betting into a -22% and getting a 16% (different pools have different takes and rebate sizes obviously) rebate they are printing money in a net -6% takeout. You can't compare 2023 when they have the ability to have a computer analyze every combination at the very last second and bet value to 1980 when you had to sit in front of a tv screen and to the best of your ability write down the probables and run to the window and try to get in your bets as the horses were getting ready to load the gate. Not to mention who knows what edges they may have developed by loading the betting databases of every race at every track for over 20 years now. The only difference between a 10% takeout and a 5% a rebate and todays game is that others would have a chance to compete and win too. In today's game nobody has a chance to win or compete except those getting rebates. In simple terms taking them on with a 5% rebate is a lot easier than taking them on with a 12-16% rebate edge (depending on the pool).

Fwiw, I personally think they are plenty good enough to beat the game with no rebate and a 10% takeout, but they would bet obviously a lot less initially and that is off the table because it might jeopardize future attempts at charity. I think they should start passing out welfare for horse racing tee shirts with every paid admission. Spread the word the racing industry has no intention on every standing on it's own two feet. I am a big fan of transparency.

[Maximillion]

Originally Posted by drib

This is incorrect. CAW's make their profit from rebates (10% or higher). Whether they actually show a profit is meaningless. Consider this: If u r getting a 10% rebate, would u rather use a system that wagers say $100k/day and shows a profit of say 2% or use a system that can bet $1 mil/day and loses 5%? In the history of parimutuel wagering, no entity has ever managed to bet most every race every day at almost every track and shown any profit close to 10%. The CAW's deserve credit for developing approaches that can plow in millions, and come close to break even, but make no mistake, rebates are the key. Take them away and CAW's disappear.

If you were betting almost every race at almost every track do you think your ROI would shrink a bit?