25 April 2010

Handle Talk; Poker Rooms At Racetracks


Sunland Park bucks the trend. Their handle went up 5% over last year. With the industry down around 10% compared to last year, that is quite an improvement.

Hawthorne's daily handle was up 4% in March compared to March last year. They canned running on Thursdays and Sundays, and ran Tuesdays and Wednesdays instead (days when competition is lighter). Woodbine should consider Mondays and Tuesdays (though Fort Erie wouldn't like it), as they need to race when competition isn't around.

Hawthorne does pretty well, considering they are ranked around 35th in total purse distributions per day, they rank 18th in total handle per race. Woodbine ranks 5th in purse distribution per day, but ranks below Hawthorne (19th) in total handle per race.

Keeneland handle dipped 7%. They did outperform the industry, but field size plagued them this year, as the dropped from over 9 horses a race to under 8.

I don't have data on Gulfstream Park field size, but they bucked the trend as well, as out of state handle rose 5%, giving them a 4% increase over last year. Gulfstream Park has relatively low takeouts and higher than average field size (according to last year's stats). They also made a good move in changing the date of the Florida Derby and got lucky with some weekend cancellations of California tracks.

With Keeneland done for the spring, Woodbine had very good handle day (for Woodbine) yesterday, as over $2.8 million was bet.  Big fields dominated the card.

Thanks to yesterday, their last five racing days have shown an increase of .5% over last year, which means their handle woes have been cut in half, from being down 20%, to being down only 10% from last year at this time.  Still a cause for concern, as they didn't have the deal with TVG in place until the summer, and that helped them out last year immensely.

There seems to be some sort of trend being established. Tracks that are available at all ADWs in the US are doing well, as long as they don't overcharge for their distribution.

Keeneland charges higher than average fees for their signal, the same with the California tracks, and of course the Tracknet tracks (which also restrict rebates even more), and throw in Woodbine too. And when it comes to availability, none are available everywhere, and what I mean by everywhere, are the ADWs that offer rebates to horseplayers.

They are shooting themselves in the foot that way, but also by charging larger fees, they restrict what can be offered to the horseplayer. Track takeout isn't as consequential to rebate players as the fees a track charges for the signal. And what is happening now, is there is a shift going on, as price conscious players are now betting more on tracks that allow for a lower net takeout (track takeout minus rebate) than these A tracks that have a higher net takeout. Field size still will attract the price conscious players in many cases though, so there are exceptions.

The only growing part of the industry right now, is the ADW sector, and to be more specific, the ADW market that gives out rebates. Rebates are not a bad thing. They keep the horseplayer in the game longer, and this helps maintain and most probably grow the game, as many of these players believe they can beat the game because some actually do. The problem is that the industry doesn't want to publicize this because it is an admission that takeout is way too high.

So tracks like Sunland and Hawthorne are seeing handle rise while most high signal tracks are seeing handles continuing to drop.

Takeout still matters a lot. Players need to stay in the game as long as possible in order to grow the game. Horseplayers who go to the track and bet live races are the best asset for growth horse racing has, but they are the ones who pay on average the highest net takeout (aside from the yo yo's who bet at NY OTB's and mindlessly pay the surcharge).

Fort Erie takes 26.2% on exactors and doubles from their live players and then they wonder where the players went. That is like McDonald's charging $8 for Big Macs and wondering where the customers are. The more a horseplayer wins, the more they bet back. The longer the player lasts, more likely the player is getting hooked. The more a horseplayer leaves the track with, the more likely the horseplayer will return ASAP.

Ajax Downs' Nick Coukos Tries To Make A Case About Turning Poker Players Into Horseplayers

Coukos believes that by allowing poker rooms at the track, that there is a shot that some players will crossover.

They have poker rooms at some tracks in the US, and handle is down down down. There is no evidence to show this will remotely work.

Boils down to takeout. House take in poker is much lower than takeout at the ponies. There are visible winners at poker too. Long term winners. Winners who made enough money to move from their parent's basement to a mansion. Not so when it comes to horse racing.

Poker player's bankrolls last much longer than pony players too. Even if you get a poker player to cross over, it won't last most of the time.

Nick Coukos is not a bad handicapper, but he admits that he went from being a poker player to a horse player and back to being a poker player now. Players go where they have the biggest bang for their buck, and it seems Coukos is doing pretty well at poker. He just won a tournament at Caesars in Vegas, beating out 194 opponents and going home with prize money worth 15 Grand.

Almost makes me want to throw away the racing form and take up poker. Note: I used to play hold em in my early 20's a few nights a week for a good spell. It was very enjoyable, but not as stimulating for me as horse racing is....but way less expensive (potentially).

Click here for some comments from Pace Advantage on the idea of poker rooms at tracks.

There is probably more of a danger that horseplayers will crossover and become poker players. And the tracks can't afford to lose more horseplayers.

Jim Day: From Boom To Bust
Sad thing is with the Ontario Sired Program, this kind of thing shouldn't happen. But there is no out for Ontario sired horses. Either they win allowance races or they become worthless. State bred claiming races are desperately needed to help the breeders, owners, and trainers of Ontario bred horses.

This video put a smile on my face especially the part with the giant ball. I like the music too(HT Joanie D at Pace Advantage):




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Anonymous said...

Finally someone looking at all aspects of why racing is up or down and not just focusing on Takeout and the economy!

Yes there are many other factors that affect handle or lack thereof. When grading a track or even looking at handle and attendance levels one needs to include ALL of the tracks attributes, where is the handle coming from - on track vs off track, takeout, host track fees, source market fees, do they have an otb network, do they have an adw system, is adw allowed in their state, customer service, facility cleanliness, number of days running, night track vs day track, days of the week running, slots vs non slots facility, big versus small events, field size, marketing efforts, local weather issues, do they have a turf course or not, how many races run on the turf vs not, summer racing vs winter racing when there is less product, the list goes on.

Even though I think you missed a few key points - Well said!

Anonymous said...

Jim Day is somewhat the architect of his own demise, but his story does point out a flaw in the Slots as Socialism scheme so common in the racing game these days. Woodbine purses (funded by slot $) line the pockets of wealthy breeders and out-of-towners while a hand to mouth owner/trainer with obvious credentials cant even get stalls. So why doesnt he just go to Ft Erie? Cant make a living I suppose.