Reducing takeout in today's horse racing environment is a complicated issue. For future growth, it is a must, but tracks reducing rates are bound to feel at least a little short term heat.
The problem is that the majority of track handle, in most cases, comes from sources where that particular track is not necessarily the only focus of the bettor who plays it. Much of the money that is cashed on a track with a lower takeout rate gets bet back on other tracks. The majority of ADW and simulcast players are not price sensitive to the point that they choose tracks that are more Horseplayer friendly in the way of takeout. There is good reason to believe that the majority of players fly by the seat of their pants, starting with a certain bankroll (possibly adding to what they were willing to lose at the start of the day if they don't hit early enough), and they continue playing 2-5 tracks or more until they are tapped, or they actually run out of time or races to bet for the day (which ensures they will have a bankroll for tomorrow).
The bulk of the money being bet by the price sensitive minority. Whales for the most part, but also systematic players who only bet when they get value. Value is enhanced greatly by either low takeout, or through rebates (but generally, from tracks that don't charge high signal fees, therefore keeping net takeout for those tracks to be comparatively lower).
HANA (Horseplayers Association of North America) has done an excellent job in educating the Horseplayer when it comes to takeout and price sensitivity. There has been an awakening of sort, as we've seen tracks that have lowered their takeout and haven't upped their signal fees actually shown increase in handle, even though handle continues to fall overall (thanks mainly to increased signal fees, and increased takeout in California).
There have been enough bettors who have stopped playing California (and even some who recently quit playing Turf Paradise as they too raised takeout rates) and have diverted those betting dollars to more Horseplayer friendly venues.
This minor betting revolt has turned out to be good news for tracks like Woodbine, Hastings, and Zia Park.
Churchill handle dropped a bit, and this is most likely due to higher signal fees and the fact that their signal isn't available at all ADWs.
Again, it is critical that tracks allow their current customers to last longer. Churn is synonymous with gambler satisfaction in most instances. Being able to last, keeping the Horseplayer in the game longer, gives the player more hope.
I can't state this enough: A player who lasts longer is more likely to expose others to the game. But for optimal growth, horse racing needs to produce visible long term winners, and in order for that to happen, it must either embrace rebates and/or lower takeout significantly.
However, because of the fact that tracks with lower takeout rates can get hurt by tracks with higher takeout rates, a little collusion is in order. I don't think it is unreasonable for the entire industry to get together and place a cap on takeout with long term growth in mind.
I think the 17-20-22 plan makes sense for starter. That is a 17% cap on WPS, a 20% max on exactors and doubles, and a 22% cap on all other exotics.
I know that those numbers are still too high, but it is a huge step in the right direction.
At this time, only Keeneland and Churchill Downs are within the prescribed limits. Charles Town recently dropped takeout is extremely close, falling short by .25% on WPS. There are quite a few other tracks that wouldn't have to make too many enemies with horsemen groups in order to satisfy my proposal.
The big problem in getting this to happen is herding the cats that run the racetracks. Who is going to do it?
BUY CANADIAN CAMPAIGN
Harness handle isn't off that much this year. Low signal fees, enabling larger rebates, have kept them close to status quo. Standardbred Canada is trying to up handle by year end by linking to free past performances and giving selections on a new web page. Check it out.
Harness fans, don't forget about the USTA Strategic Wagering page which offer free TrackMaster past performances for guaranteed pool sequences. Good stuff!
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