New Ways to Do Business

Two items this morning.

Ray Paulick has a post up from Barry Irwin, titled "Racings value, Where's the Beef?". In the item, Irwin asks for tracks and horseman to get together on medication (the high costs are murder), feed (there has to be a cheaper way) and takeout - he calls for 12%.

He is one of several lately calling for a takeout at that level - and they are not the usual suspects, i.e. bettors. They are industry insiders.

Secondly, a harness fan pointed us to this interesting article on Harnesscharts.com. This is the site for the "Harness Eye" a very good past performance sheet available throughout many parts of the US. They have proprietary speed figs, trip notes and a ton else. Several players have been asking for these to be available online. The editor of the site offers this about those questions (bolded part mine):

..... inquiries on the status of our past performances are something I simply will not be able to answer with any certainty. In fact, I’ll clear the air on that subject right now. In the early stages of 2009 we began supplying FREE past performances on our site for select Meadowlands and Yonkers cards to help promote the sport and increase the scope of our product. Unfortunately, we were asked to cease these postings by the United States Trotting Association. While we maintain a contract to utilize data from the USTA to produce our print products, any electronic distribution of our past performances is forbidden. I would certainly encourage our customers or anyone out of our print area to contact the USTA at 877-800-8782 or e-mail Executive VP Mike Tanner at Mike.Tanner@ustrotting.com. Mike is a great guy who is committed to the sport. Let him know you would like a choice when purchasing electronic past performances. Voice your opinion that Harness Eye offers a superior product. We want to be able to offer you our past performances when you want them and in the most convenient method possible. Help us help you by making your voice heard.

It's a problem when an entrepreneur can't offer promo past performances for a card of racing, to up the bet, and maybe get a few people energized about the product. We have said it before and we will say it again: Data deals signed and constructed before the internet was introduced should be thrown in the trash can and we should start over.

It's a new world out there and we have to stop acting like we are still living in the old one.

HANA/Arizona Stakeholder Meetings - Is Online Wagering For Arizona Horseplayers a Step Closer to Reality?

On September 19th 2007, Arizona House Bill 2694 became state law. This bill "made any individual outside of a licensed racetrack or off-track betting facility that accepts a wager or bets on the results of a race is guilty of a class six felony, which can bring imprisonment." Immediately, ADW's like Youbet pulled out of Arizona, and horseplayers could no longer enjoy the sport of horse racing over the internet. Arizona racing fans were understandably upset, and they spoke with their dollars.

Two and a half years later, we are happy to report this might be changing.

On Monday January 25, 2010 the Arizona Department of Racing held a meeting termed an Internal Industry Discussion Forum. Present at this meeting were representatives from Yavapai Downs, Turf Paradise, The Arizona HBPA, The Arizona Racing Commission, The Arizona Department of Racing, The Arizona Attorney General's Office, and several members of the Horseplayers Association of North America, led by President Jeff Platt. HANA had first met with Arizona stakeholders in August of 2009 to present the idea of agency wagering as an alternative to the present lockout, and this was our third such meeting.

The meeting was held at the request of Yavapai Downs General Manager Gary Spiker and Director of Racing Greg "Boomer" Wry. The purpose of the meeting was to allow representatives from Yavapai Downs to present a proposal to the Department for Agency Wagering and to allow for questions and comments from various interested parties among Arizona's Racing Industry.

Agency Wagering is very similar to Account Deposit Wagering - the key difference being that under the proposal Yavapai Downs would be acting as the agent as opposed to an outside vendor. If adopted, the proposal would allow Arizona's tracks and horsemen to operate their own ADW and retain a revenue share similar to what they retain when wagers are made at a track or otb. Players who are currently shut out because of Arizona's ADW Law would have a way to wager on races over the internet.

HANA representatives spoke up in favor of the proposal, not because we think it represents the ideal model (it doesn't) - but because we see it as a complete reversal from the thought process that led to creation of Arizona's ADW Law making it a felony for players to wager on races online or by telephone.

The proposal appears to have the support of Yavapai Downs, The Arizona HBPA, The Arizona Department of Racing, and Arizona players, but not the support of Turf Paradise.

The proposal is still in its infancy and faces significant hurdles before it can be enacted. Arizona's ADW Law states that wagers can only be accepted if they are made "within the racing enclosure"; the implication being that wagers made outside the racing enclosure constitute criminal activity.

The Arizona Attorney General's Office will need to examine the proposal and decide whether or not wagers submitted over the internet to equipment located at Yavapai Downs owned by Arizona's Tracks and Horsemen would in fact be wagers made "within the racing enclosure." If a favorable ruling is given, then look for the proposal to move forward.

The Arizona Attorney General's Office will also need to examine the proposal in light of the Indian Gaming Compacts between the State of Arizona and Arizona's many Indian Tribes. The Compacts give the Tribes exclusive rights to "Expansion of Class III Gaming" within the State Of Arizona. If Yavapai's proposal for Agency Wagering is determined to be "Expansion of Class III Gaming" as defined in the Tribal Gaming Compacts, "poison pill" provisions in the Compacts provide for significant reductions in annual revenue paid by the Tribes to the State of Arizona along with unlimited "Expansion of Class III Gaming" on the part of the tribes. The political climate in Arizona remains conservative. Nobody holding a public office in Arizona wants to be known as the one who allowed the Tribes to trigger the "poison pill" clauses in their compacts.

Despite these and possibly other hurdles - we expect Yavapai's proposal for Agency Wagering to be submitted to the Arizona Attorney General's Office for review sometime in the very near future.

No matter what the outcome of the opinion handed down by the State Attorney General's Office, at least one track in Arizona, Yavapai Downs, is making an effort to reach out to players. HANA sees this as a player friendly first step -- hopefully the first of many to come.

We have had continual discussions with Yavapai and we hope to make further announcements as those steps are taken.

Tampa HANA Day Getting Closer

On February 6th several of us are visiting Tampa Bay Downs for a HANA Day at the races. At 11:15 sharp Tampa has given us a venue to hold a meeting, then let the winning (or in my case losing) begin.

For those who have not contacted our point woman on this, you can by emailing Theresia @ Hanaweb.org (no spaces).

We will send out a reminder later in the week should you be in the area and want to spend some time with horseplayers.

Everyone is looking forward to it!

Savin' Me

The great philosopher Locke, no not him, Plato.... no..... it was Chad Kroeger from Nickelback, wrote in Savin' Me:

Show me what it's like
To be the last one standing
And teach me wrong from right
And I'll show you what I can be

Thanks to a tweet from Jessica at r2, Frank Mitchell pointed us to this poignant, all-too-true post titled "Who Will Save Us" from a marketer to compare to racing.


If by save you mean, "what will keep things just as they are?" then the answer is nothing will. It's over.

We need to get past this idea of saving, because the status quo is leaving the building, and quickly. Not just in print of course, but in your industry too.


In racing, if many of the things needed to be done are done, there will be losers. It might be a feed man at a small slots track who will have less or no business. It might come in the form of lower betting revenues as we reprice the product. There will be job losses, purse losses and some tracks might close. Life will be very different. When you save yourself, rather than having someone save you, life is never the same.

As the author closes: "Every revolution destroys the average middle first and most savagely."

If he is indeed correct, does racing have the stomach for that?

Related Posts: Frank Mitchell on the breeding end of "Saving Us".

He is Correct!

Alex Waldrop is correct. 100% correct.

In his new column he relays what he heard this past weekend at the NHC Championship (congrats Brian!) from horseplayers.

- Their message to tracks: Price matters. According to one very knowledgeable race and sports book operator I spoke with in Vegas, they are seeing a steady migration of players from horse racing to sports betting and other gaming. Why? Lower takeout on casino games and sports betting are a big part of the reason.

- Their Safety and integrity matter. If you think the way you treat your horse is a private matter between you and your vet, think again

- Their message to regulators: Be tough but fair in regulating the game. And be consistent.

We at HANA have surveyed horseplayers, written hundreds of blog pieces, attended dozens of meetings. We have conveyed this now for some time.

It is not a me versus you debate, it is an us debate.

We don't want lower takeout because we are greedy - we want lower takeout so we can bet more and encourage others to bet more by saying to new people "you have a shot to beat the races, so come join us".

We don't want safety concerns looked at because we really like to see tracks be regulated. We want safety and integrity because we feel with it we will have a better sport, and if we have a better sport, we can grow.

We don't want drug policy because we are zealots. We want a consistent drug policy because we love horses and want them treated well. We want cheaters to be charged because they hurt the game. We don't want honest horsemen charged and thrown out for making a minor mistake. We want a good policy with teeth to grow the sport of horse racing, for bettors and horse owners. Heck, almost 20% of HANA are horse owners.

Very well done regardless Alex. You summed it up pretty well.

Pari-Mutuel and Movies

In the face of tremendous competiton from the likes of Netflix, movie-rental stores, cable television video-on-demand, HBO, home entertainment centers, and pirated movies on the Internet, the retail movie-theater business has been able not only to hang on, but also to manage to grow.

Bill Shanklin's take here

Where Does All the Money Go?

Since 1998 betting revenue is down, foal crops are stable, the number of races is down; but purses are up 30%. Since 1998, horse owners don't seem to make too much money, bettors have been killed with takeout hikes, and racing has shrunk as a mainstream sport, not grown.

What good is a 30% increase in purses if we can't grow any key demand metric?

Pricci Weighs In

John Pricci in today's column on NYRA, takeout, Los Alamitos and more:

Two weeks ago, HorseRaceInsider, backing the play of the Horseplayers Association of North America, implored readers to e-mail the California Horse Racing Board requesting it not raise takeout on races from Los Alamitos.

It should be clear to those who control New York’s destiny that horseplayers no longer can be taken for granted. The player is voting with his dollars, concentrating on tracks with a good product at a fair price. Still others are voting with their feet and walking away for good. This on top of a demographic that skews older by the minute.

..... and other Internet sites that post takeout rates from tracks throughout the country, today’s educated horseplayers are aware of the inequities of takeout and have been betting their money at venues where dollars go farther.

More

Youbet Promo for Sam Houston

In another sign that ADW's are about the only ones fighting for customers, Youbet has offered a unique promotion on Sam Houston:

Here's how it works:
1. Play any Pick 3 at Sam Houston on Saturday, January 30
2. For every Pick 3 ticket you cash on Youbet.com, you will earn a Winner's Bonus equal to 13.64% of your gross Pick 3 winnings for the night - effectively eliminating the 12% track takeout for the Pick 3 at Sam Houston
3. Pick 3 bonuses will be credited by Tuesday, February 2

Learn more here

Harness Tracks Lower Takeout

In 2003 or 2004 harness racing went through many problems that thoroughbred tracks are now going through. Several keen observers of the sport at that time cautioned thoroughbred racing that harness was a "leading indicator" of sorts - what happens in harness will happen a few years later in thoroughbred racing.

Well, we can all hope that giving their customers respect that we are currently seeing in harness racing is followed swiftly by the runners.

First we had a racing commission step in to fix a signal fight.

I am dismayed and disappointed that the respective parties are so short sighted that they opted to penalize the most important component of their joint business, the customer. Why not find a mutually acceptable means to keep the customer served?............Are racing’s customers in such great supply that it can afford the luxury of turning off the signal? Today, customers have many options on where to spend their “disposable” dollars. They don’t need horse racing, horse racing needs them!

Within two weeks the two jurisdictions this affected were opened up to bettors while the participants worked out their differences.

Next we had the Meadowlands push their 15% takeout pick 4 and increase the pool guarantee.

Now it is announced today that Balmoral park has slashed their takeout on their pick 4 almost in half, to 15%. They have also made some pool variety changes for their 2010 meet.

We at HANA have heard rumblings that harness tracks and jurisdictions are taking lower takeout very seriously. We hope to report more good news as we get it. And we hope it does not take years for thoroughbred racing to follow suit.

NY OTB to Close - Things Change

It was announced that the New York city OTB network will close on March 30th, unless their reorganization plan is approved. One part of the plan calls for : "the state's tracks should "set the stage" to earn more revenue from simulcasting by increasing the rate for their signals."

So, they want to jack up rates (it does not matter where they jack them up, there is only one end user). That sounds a little anachronistic to us. It's not like it is 1986.

Roger Stein on AM830; Asks: Horseplayers to "Stand Up" Against Los Alamitos

Roger Stein, the So Cal based trainer, asked horseplayers to take a stand to protest the Los Alamitos takeout increase on his radio show today.

"It [the takeout increase] is a mistake." Stein said.

"Horseplayers have to come together...... to say they are not going to take it anymore. Unite, tell them we are not going to be gouged anymore. Pick a day, pool don't play."

His guests on the show agreed.

Bettor Bob: "this is hardball. They say they want to compete with other jurisdictions. They want to compete alright - by competing with others who rip off their customers."

Guest John Hardoon "2 full points is absurd and it is madness."

Some Los Al horseplayers, according to our inbox have been taking a stand thus far it appears. Handle for the first two days has not been good. For a recap, with full comparisons, click here.

Opening Night at Los Alamitos: Handle Down by 25%

Last week, despite horseplayer representation against it, the CHRB raised takeout at Los Alamitos by 2% in WPS and exotics - a more than 10% increase in prices.

The takeout increase went into effect last night. After receiving player emails and reading message boards all week (including a letter sent and posted here on the blog by a player) we suspected that that opening night handle would be off in some way. It appears some horseplayers sent a message to horse racing last night.

Last night the handle at the So Cal track was down 25%.

From a horseplayer:

Comparing tonight's numbers to last Thursday's numbers.....

Both nights had 8 races with basically equal quality and field size.

Tonight's total handle $577K

Last Thursday's total handle $767K

Down 25%

I'm sure they'll blame it on the weather and SA canceling.......BUT.......

On track handle was only down 21%

In-state handle was down 26%

Out of state and ADW handle was down 24%

If it was just the weather, why was non-Ca handle down 24%?

According to another Los Al player:

"I looked at Los Al's handle for all of 2009. The average Thursday handle for the 47 cards they ran was appx 756k

The single worst handle was on 6-25-09, 638,624

Only 10 of the 47 days were under 700k

So tonights handle was easily the worst in recent history."

It should be noted that new CHRB Chair Keith Brackpool was with HANA President Jeff Platt and other horseplayers against the increase. Via the DRF: "Brackpool was a vocal challenger to a proposal by Los Alamitos to increase takeout by 2 percent to help satellite locations that are suffering business declines. The track compromised by allowing the increase to lapse in early September. Brackpool was the only commissioner to vote against the plan. "It's a slippery slope," he said of raising takeout. "I don't like it."

As HANA members stated in our recently completed survey, takeout rates were their number one issue. They understand that in the long run, a takeout increase lowers handle, lowers pool size and decreases racings growth, and studies by Cummings and the University of Louisville (not to mention comprehensive empirical evidence) backs this up. Horseplayers want racing to grow, not recede. We commend horseplayers for energizing themselves on this issue.

If you would like to join us at HANA we need your support. You can do that right here. It only takes a minute.

CA Takeout Increase

The following was written for me by a fellow horseplayer who is a HANA supporter. I agree 100% with every word:


An Open Letter to Los Alamitos Horseplayers

Last week HANA Pres Jeff Platt spoke at a CHRB meeting in opposition to a proposed 2% takeout increase at Los Alamitos. The CHRB Board, despite the evidence presented that an increase in takeout rates would have a negative impact on handle and revenues, decided to institute the raise. They also included a review process, where by the CHRB would from time to time review Los Alamitos handle numbers between now and Sept 8th, 2010, in order to monitor the effect of this takeout increase on handle.

If the handle numbers come back weak, and show that horseplayers are reacting negatively to this takeout increase, there is a high likelihood it will be rescinded. If the handle numbers come back unchanged, there is a high likelihood the takeout increase will be made permanent. It is also likely, in our opinion, that if Los Alamitos handle is strong, that other California tracks will follow suit with takeout raises of their own. We know this would have a very negative effect on you, as a horseplayer, and in return on California Racing as a whole.

You, as a Los Alamitos bettor, have a very big say in all of this. Each dollar bet at Los Alamitos is a vote for making the takeout increase permanent, and a vote towards seeing higher takeouts across California. Each dollar withheld from Los Alamitos is a vote towards rescinding this takeout increase, and discrediting the notion that racing's revenue problems can be solved by simply raising the price of an already overpriced product. You are in the enviable position to have a direct and measurable impact on the future of California racing, and to make a statement on behalf of horseplayers everywhere.

We ask you to consider these facts, and we trust that your actions and decisions will help to bring about a better and brighter future for this game.

Please pass this message on to fellow horseplayers everywhere.


Jeff Platt

President, HANA


Please lend us a hand at HANA by signing up here.

Trends v Bubbles

It was reported that NYRA wagering was off over 10% in 2009. That's no surprise, we are used to this news lately, however, it is usually dismissed as "the economy" rather than systemic problems - almost like we were somehow rolling in dough before this recessionary period.

We hope we move past that soon, and get at the issues at hand.

Housing Bubble



Pari-Mutuel Trend (Handle 2003-2009)