Sunday, December 20, 2009

A Walk Through Takeout's Past

The Internet affords us plenty of opportunities to learn. We set up google alerts here at HANA. When HANA is mentioned, or if horseplayers are chatting about what they like or do not like about playing the horses, we are alerted. We got something interesting that popped up this morning.

I am not sure if the Baltimore Sun reindexed or what, but we got several alerts on "takeout rates" added to the inbox. It was a walk down memory lane.

First, in 1993 there was a story on the opening of Hialeah - and some takeout hikes. "Only this year will be different. Hialeah owner John Brunetti will do the unimaginable; he will make Hialeah the worst place on earth to play horses. Hialeah opens April 1, April Fools' Day for South Florida bettors. Brunetti plans to institute what is believed to be the highest takeout structure in the history of U.S. thoroughbred racing. The take on win, place and show bets will be 23.1 percent and there will be a 28 percent take on all other wagers. Winning money -- never easy at the track -- will be impossible at Hialeah."

16 years later I wonder how they are doing.

Second, another takeout hike in a story, this time in 2000, at Laurel. This price hike was to raise more money from horseplayers to fix up the track. I think it would have been better to lend a few folks at the simo-center a hammer and a nail and get them to pitch in that way. "The world's toughest game is about to get tougher. Betting on thoroughbred racing becomes more expensive today for fans in Maryland. With the blessing of the governor and General Assembly, the Maryland Jockey Club has raised the takeout - the money withheld from every wager."

The hilarious - some would call it sad - part about the above hike? Laurel came out with a press release 28 days later saying that takeout did not kill handle. "In my opinion, it's had zero impact so far," Mango said. Anyone - a bettor, an economist, heck a student with some decent math skills - will tell you takeout increases or decreases, based on churn, will take years to show its force. But the folks who ran this, based their measurable metric on what happened in less than a month.

We spoke about Tampa below, lowering takes each year, hoping to build a following and some on track churn. Their takeouts are becoming less and less. It was an interesting note in the above column about Tampa in the early nineties: "Tampa Bay also passed the cost on to its fans, now taking 20 percent from all straight bets and 28 percent on exotics.

Those numbers were insane. Thankfully, cooler heads have prevailed at Tampa (not through altruism, through common sense and a loss of business) and they are surviving.

That's a trip through takeout memory lane. It seems we have not learned much over the years.

1 comment:

The_Knight_Sky said...

An excellent piece. Especially liked Mr. Finley writing about the "impossibility" of making money at Hialeah.

I think it's great that Tampa Bay has been steadily reducing their takeout rates but I do believe they have to lower it to under Gulfstream Park's rates to compensate for a lower quality of stock. Only then would I play that signal as seriously as I do with Gulfstream's.

Clearly Tampa Bay Downs has learned from their mistakes. Has Hialeah done so also?