Tuesday, June 5, 2012

Hollywood Park: Slumping handle could cause purse cut

Article by Steve Andersen at the DRF:
"INGLEWOOD, Calif. – A decline in all-sources handle could lead to a purse cut at the current spring-summer meeting at Betfair Hollywood Park, according to the track’s president, Jack Liebau.

Liebau said last weekend that handle has declined 5 percent compared with the 2011 meeting, attributing much of the reduction to lower field sizes."

Below are my reactions to this. I've decided to shoot from the hip and not pull any punches. Those making the decisions for racing need to hear the truth (even if they don't want to believe it.) --Jeff Platt

Field size? Seriously? As in 7.64 last year vs. 7.52 this year? – a difference of (what?) 0.12 horses per race – and they cite field size?

Here’s a novel idea: Why not (just once) tell the truth?

Fact: Cal Racing total thoroughbred handle for 2012 (not adjusted for inflation) is on track to come in at HALF of what it was for 2001.

Cal Racing losing 50 percent of its business (total customer spend in terms of thoroughbred handle) in that short a time span is significant. Because the drop is so big – and because it happened in so short a time span...

There has to be a reason – right?

The most recent CHRB Annual Report begins with a section titled Report of the Chairman. In those opening paragraphs, CHRB Chairman Keith Brackpool cites the economy as the primary reason for last year’s decline.

"Handle continued to suffer as the economy continued to struggle. This is a national phenomenon and one that won’t change substantially for the better without a real bounce in the economy."
Somehow, blaming the economy for slumping handle doesn’t ring true to me.

The way I see it, this year’s decline,  and last year’s decline, and the decline the year before that, and the year before that, and the year before that, and the year before that (get the picture?) are all part of the bigger picture – one that you as HANA members have been telling us about since we began asking you.

When it comes to you the horseplayer spending less of your hard earned money on the product:

Rather than tell the truth, Cal Racing has resorted to spinning things. In case you have been living under a rock, “spin” is a euphemism that means “making stuff up.” In my opinion, rather than tell the truth, they have been “making stuff up" so they can “spin” their less than stellar results in the most favorable light possible.

They cite the economy, field size (when in fact field size hasn’t changed that much), the weather, federal holidays, purses (despite the fact that industry funded studies clearly state purse size has a negligible impact on handle and that takeout has a very big impact on handle.) They have all but abandoned reporting the industry’s long standing metric (total all sources handle) – and after cutting race dates and laying off employees - instead now report average handle per race.

They do all of this in an effort to pull the wool over your eyes and lead you to think everything is rosy as can be when in fact it is not. They have cited everything and anything EXCEPT the real reasons their business has been circling the drain.

In HANA surveys, you the horseplayer have consistently cited the following three issues are being the most critical as relates to your willingness to open your wallets and spend your hard earned money on horse racing:

  1. Takeout - It’s too high and you want it lowered. Remember SB1072? The bill that raised takeout in California? You can thank the CHRB and the TOC because that bill was their brainchild. They lobbied for that bill and called it "the single best thing we can do to save California racing." Because of that bill, you can thank the CHRB and the TOC for California's 22.68% exacta takeout - the highest of any major track in North America. (By way of comparison, exacta takeout at NYRA tracks Aqueduct, Belmont, and Saratoga is 18.50%. By way of comparison, exacta takeout at Kentucky tracks Keeneland and Churchill is 19.00%. By the way, Churchill recently announced a purse increase because their handle was up.) 
  2. Drugs. (Racing is a gambling game and INTEGRITY matters – especially when it comes to gambling games.)
  3. Odds that change after the bell. (See my comments about integrity in item 2 above.)

They can keep making stuff up and citing it for all I care. (They can only fool themselves for so long.) But they’re no longer fooling me – and they’re certainly not fooling you the horseplayer – because apparently, you the horseplayer have been speaking with your wallets for some time now.

Jeff Platt
President, HANA

1 comment:

kyle said...

I don't disgree with you that they are spinning the numbers. And of course I don't disagree that California racing, all racing, is overpriced. Your take on field size, however, misses a couple points. First, Hollywood fields are suffering. Big fields of cheap horses inflate average field size. So that metric alone doesn't really tell the tale. Do you think you'd bet more on a five race series that had fields of 12,12,6,5,and 5 or five races with 8 horses in each race? I know I'd bet more on the latter, especially if those two 12 horse fields were a couple maiden claimers.
The only two things I care about are "value" and "quality." Value is a function of field size and takeout. Quality is a function of field size and class. So, field size is very important to me. Where the Hollywood apologists miss the point is that the product they are presenting isn't worth the price. That is the bottom line. If they can't offer "quality," they, of course, should cut the price. Exchange wagering is one option. The other, I propose, is making takeout a function of field size. I guess that's way too complicated to consider. But I think it would cut to the heart of the problem.