15 December 2009

Woodbine Cares More About Quebec Racing Than Fort Erie

In an interview yesterday on The FAN, Nick Eaves showed complete indifference to the plight of racing at Fort Erie race track.

Eaves (Woodbine's Big Cheese In Waiting) actually said to host Mike Hogan (who admitted knowing next to nothing about Fort Erie or Quebec's current situation) that "I don't know anything you don't know," in regards to the future of horse racing in Fort Erie. All I can say is WOW. He went on to say that the future "doesn't look terribly bright."

Actually Eaves may be correct about Hogan knowing as much as he. Eaves stated in the interview that Woodbine sold Fort Erie because they had the foresight regarding competition coming from Niagara Falls and Buffalo. The reality is that the sale of Fort Erie came around 2 years before slots came into the picture at racetracks in Ontario. Reportedly, Fort Erie was sold for $10 and the assumption of $1 million in debt.

Woodbine was simply consolidating their operations at the time. And the sale of Fort Erie looked horrible on Woodbine once slot machines were added to the tracks. The new owner's (Nordic Gaming) share of slot revenues peaked at $17 million in 2001. Woodbine gave away a lot of revenue for next to nothing.

It makes me wonder if Eaves is either ignorant of the sale or if he was being disingenuous (by trying to sugarcoat Woodbine's past moves) in the interview.

Had it not been for 9/11 and SARS, Fort Erie's stream would have been much higher in the next few years. Even Willmot and Eaves couldn't have predicted those two events:)

Had Woodbine still owned Fort Erie today, they would not be in trouble of shutting down, and I doubt the operation would not be losing money because the revenue streams would be much different.

Getting back to Quebec. What does WEG have to gain by Quebec racing? For one thing, they get back the revenue they have been losing because Quebec gamblers cannot bet through a Canadian based ADW (ie HPI). WEG is losing half a million in handle per month right now.

Quebec gamblers do have options. They can play on Betfair, William Hill, offshore bookies, and even US based ADWs that take Canadian customers.

I find it funny that Eaves sticks to the line that all other betting (outside of betting at HPI) done by Canadians is illegal. Again, it is not the case. William Hill (a large bookie across the pond) even advertises on The FAN radio station. The only thing that would be illegal is for a company in Canada to have its server in Canada and take bets from a Canadian (unless of course we are talking about an Indian Reserve in Canada, which is not considered to be in Canada as far as the law goes).

It is clear from the interview that WEG cares about one thing and one thing only: How much they can take from whatever source they can take it from. When speaking about growth, Eaves attention was on Woodbine Live, which will do zero when it comes to growing horse racing, other than give WEG a bigger revenue stream so that they can inflate purses from non horse racing betting.

Weren't slots introduced to racetracks in Ontario to help sustain the industry in Ontario?

How is putting Quebec ahead of Fort Erie helping Ontario's industry?

The harness situation firs. For one thing, there are 20 harness tracks in Ontario, and without slots there would be one or two. So yes, slots do create quite a few jobs on the harness side. If one track were to close, there wouldn't be that much of an affect when it comes to the job situation, as the industry is leaning towards less dates anyways right now. And many tracks don't race that many dates to begin with. But to my knowledge, no Racino is looking to close up shop at this time on the harness side anyway.

Why should Fort Erie be a major concern to Woodbine?

Again, lets go on the assumption that slots at racetracks are there for the purpose of helping out the horse racing industry in Ontario. This is something that WEG has lost total sight of.

Woodbine runs 8 months a year and this allows for many full time jobs to be created at the racetrack. From trainers to their staff to those in the feed business to breeders to those who work inside the track, horse racing allows people the opportunity to make a living.

There are three major sources of revenue that keeps the operation going: Revenue from betting, revenue from slots, and the amounts lost by owners collectively (a number that isn't as high as it used to be thanks to slot revenue enhanced purses).

In Ontario, the big show is Woodbine, but the reality is that many horses bred and/or owned in Ontario can't compete there. Some horses simply hate the polytrack, while others are just inferior or become inferior over time. Every horse is a split second away from an injury, minor or major, that can affect whether or not it can race at Woodbine competitively.

Owners of race horses know this, especially the smaller outfits.

So what happens if Fort Erie were to close down?

There would be no B track, and no dirt track in Ontario for owners to have as a safety net. When the horse is either a bad form or just not good enough for Woodbine, their only choices are to sell the horse for next to nothing or ship them down south and try a cheap dirt track there.

This will create less owners at Woodbine, let alone all the B horsemen that will be out of work if Fort Erie were to shut down.

Less owners means less demand for horses in Ontario. This means breeders will suffer even more, to the point that many will just have to close down shop. Less farms will be caring for horses as well. There will be less horses to feed.

This will also cause less betting and less interest in horse racing, as many B owners especially like to form partnerships and come to the track when their horses run, and many of them bet too. They also bring friends. This is one of the biggest angles to actually growing the game.

Meanwhile, Woodbine has done an excellent job in getting Kentucky breds and US outfits to come to Ontario. Again, is this what slot money was supposed to do? Give many of the big purses to foreign entities? And now Quebec's situation is more of an issue than Fort Erie's?

Doesn't in give Ontario horsemen a warm and fuzzy feeling that revenues from slots and potentially from Woodbine Live mainly go to $2 million races that are won by foreigners, while breeders and B horse owners continue to get the shaft?

The reality is that Woodbine must know that losing B horses will be devastating to the Ontario thoroughbred industry, and it makes me wonder if WEG wants Fort Erie to die so that Ajax Downs can host the B meet.

Ajax Downs is not going away, so no matter what Woodbine will have to split betting revenues form their home market. But if Fort Erie goes under, they get the Fort Erie home market to themselves. It might not be much, but either is Quebec. But both situations only add to Woodbine's revenue, and that is all it seems that WEG is about these days: How much more they can grab for as little cost as possible.

There is no question that Nordic's refusal to ask fair market price for the track has been a major obstacle and extra cause for uncertainty regarding Fort Erie's future. The government must tell Fort Erie "No Racing No Slots." This will take Nordic out of the driver's seat.

It is ridiculous precedence to have slots without racing. What is to stop any track from giving an ugly looking set of books in order to make the same claim in the future? I'm sure there are some harness tracks that are close to break even right now. If they were to show a loss thanks to the racing operations, does that mean the track owner can close the track and keep the slots thanks to this new potential precedence?

One more thing, regarding yesterday's interview. I don't think the proposed auto track in Fort Erie would be competition against the racetrack. In fact, it would cause more Americans to get passports or Nexus cards. As well, it would create more jobs in the area.

More people would visit Fort Erie Slots and maybe even the track, because many people will want to kill time here instead of waiting in a lineup to cross the border, plus for real big races, many fans come days in advance to camp out.

OK, so if you want to hear Nick Eaves for yourself, click here.

If you want to read more about the interview, click here.


Anonymous said...

Didnt hear the interview so I dont know who said what about the speedway but I think its a no-brainer that the speedway would HELP Ft Erie.

On a different note: Aside from Ft Erie (and I guess Windsor?) what tracks in Ontario are efectively competing with OLG casinos in their own backyard? Wonder why we never hear anyone squawk about that?

Cangamble said...

The interview is linked at the bottom of the post.
It was Mike Hogan who asked about it. He lumped it in a question about Fort Erie. And Eaves played? dumb.

I don't think that Fort Erie racetrack hurts Niagara Falls business at all. And the OLG winds up getting their dough from slots, probably a lot more than they would if Fort Erie were to close up shop.

DARYL G. EZRA said...

The "GOLDEN GOOSE" or in this case the "GOLDEN GEESE" were installed where they are to ENHANCE "LIVE RACING"...bottom line...not be confused with a bottom line. If Fort Erie Racetrack closes the INDUSTRY would be DEVASTATED... from tip to tail.

Anonymous said...

what happened to the GREAT SANDINSKY REPORT is every body involved with horse racing just pissing into the wind