Harness Racing Track Takeout Chart

This chart was recently published in HANA's free e-magazine Horseplayer Monthly.

THE JUICE, THE VIG, THE HOUSE EDGE, THE TAKEOUT

With sports betting most likely becoming a reality in the USA in the very near future, I thought it might be a good time to re-publish an article I wrote for HANA two years ago comparing horse racing's competition. For what it is worth, horse racing takeouts range from bet type to bet type and track to track (12% - 31%), though it is estimated to collectively be between 21-22%, not taking rebates or other incentives into account:

Sports Betting: When it comes to traditionally betting a single game against the spread, in theory, the house edge is 4.76% without taking pushes into account. Other factors come into play though. Bookmakers do not usually make the spread with a 50/50 outcome in mind, but rather make the number one in which they think will attract 50% of the money each way. This could create an underlay on the dog when a good and popular team is favored, for example.

Two team parlays generally pay 2.6-1 which translates into a 10% house edge. However, because one might be able to find two real underlays, and because there are certain tendencies when betting the spread and over under in a single game (for example, when there is a home favorite in football and lets say the over under number is 42, there are two outcomes which dominate, the home team under, and the away team and the over, which is due to the strategies employed by teams in the second half depending on the lead). Bottom line is that the collective edge is certainly less than 10%,

Three team parlays generally pay 6-1, but there are 8 outcomes which means the edge is 12.5% if random selections are made.

Vegas publishes their win rate. Collectively on sports betting it is just a little more than 5% of total handle (it varies very slightly year to year).

Lotteries: State lotteries generally payout approximately 50% of the total money taken in. Comparing horse racing to lotteries in often done and always silly. When someone buys a lottery ticket they are usually buying a dream, it is an entertainment expense in a way as one fantasizes about retiring to their own Island.

Scratch lottery tickets, have an expected payout range in line with horse race exotic wagers.

Blackjack: If one plays by the rules without counting, the house edge is only .5%. Though, it sounds like the best bang for a gambler's buck, a bankroll can disappear pretty quickly when playing 75 hands per hour. Still, the game is still perceived as beatable mostly thanks to stories of counters being barred by casinos.

Craps: Odds on resolved bets range from 0% to 11%, and the collective edge the house has is around 1-1.5%. This is a game that is somewhat complicated and mathematically impossible to win at long term for even the best players, not the best of combinations.

Slots: The house edge on slot machines ranges from 2% to 15% (collectively around 8%). The exact amount a machine wins long term can be programmed by the operator. Unless one hits a huge progressive jackpot and then quits slots, this game is impossible to win at long term.

Some operators have admitted to "loosen" machines at peak hours. The theory behind this is when the casino is full, the sound of winning will help hook players for more repeat business. When it comes to horse racing, an argument can be made that is the reverse of this, higher takeout on bigger days because many just play on big days, while dropping takeout the rest of the year to keep the regulars in action longer while keeping them from focusing on other forms of gambling. This approach hasn't been tried yet.

Roulette: Thanks to O and OO the house edge is 5.26%, as long as the wheel doesn't have any flaws. This game is far less intimidating and a little less social than craps and it requires the same zero skill level as slots. If you play roulette for 14 days straight, you will lose over 5% of your total wagers.

Poker: The rake for poker is 2-5%. Skill is involved when it comes to knowing probabilities, and if playing live, reading other players. A player with superior skill has a chance to win long term due to relatively low rake.

Daily Fantasy Sports: DFS was growing exponentially in popularity prior to state regulations. DFS likes to call their house edge a commission, and whatever you want to call it, it is around 9-12%. It is definitely a game of skill as well as it is gambling. Estimates are that the top 2% of the total players make money and also are responsible for a very high percentage of what is played in total. This means that at this time, for those with superior skill, the game can be beaten long term.

DFS is extremely similar to horse racing when it comes to degree of difficulty and homework needed to make good selection, though horse racing handicapping has a higher learning curve. DFS seems to be attracting players, especially millennials, because it is perceived as beatable by at least a few.

Guess Who Has The Lowest Pick 4 Track Takeout

Monmouth? Close. Their Pick 4 takeout is 15%
Hollywood, Del Mar, and Santa Anita? Noooo. They raised the takeout on Pick 4's from 20.68% to 23.68% January 1st. Those dummies.
How about Woodbine? Uh that would be a no. 25%.
Keeneland or Churchill? Again close. 19%.
Aqueduct, Belmont, and Saratoga. Not even close at 26%.
Portland Meadows? You get part marks. They are now tied for the lowest rate at 14%. They used to be alone on top. But now they have been joined by Fort Erie Race Track.

You read that right. Starting tomorrow, Fort Erie has lowered the track takeout on Pick 4's from 26.2% to 14%.


From a press release: “We are testing the waters in terms of takeout reduction,” said FELRC’s Chief Operating Officer Rick Cowan. “Management will assess the results on a regular basis.”

Lets hope this is a massive success. I want Fort Erie to survive, but their track takeouts are way too high. If this drop works, I expect to see doubles and exactors to come way down too (there is plenty of room for some large drops).

This appears different than the disingenuous bone being tossed to Horseplayers by Hollywood Park when they recently put a low takeout Pick 5 on the menu. That bet has been successful despite the Horseplayers Boycott on California racing, and proof that there are plenty of cognizant players out there looking for value. But do you think they are doing anything with the empirical evidence and doing away with that larcenous takeout increase that occurred in January? The answer is a big fat no.

I'm truly hopeful that if this works, Fort Erie will make more moves that are player friendly in the near future.

There is an early Pick 4 that begins in race 1, and another that begins in race 4. If there is a 10 race card, a third one begins in race 7.

That pesky Horseplayer/Owner over at Pull The Pocket thinks "It's Time For Woodbine To Lower The Pick 4 Takeout."

It certainly is. With all the dysfunction going on in other jurisdictions, Woodbine could be on the runway to great growth. Lowering the triactor takeout from 27% to 25% recently was just is a minor step in the right direction. They need something that cries out "follow and play Woodbine daily."


BELMONT STAKES


My recent predictions haven't been all that great. You gotta keep picking yourself up and dusting yourself off though or you might as well be dead.

I'm pretty firm on my prediction today. I even think I have a decent shot at the Superfecta. I'm going with Nehro to win it, long shot Prime Cut to come second, the chalk Animal Kingdom for third, and Mucho Macho Man to finish fourth.


Tomorrow, HANA (Horseplayers Association of North America) is having another Pool Party, this time at Tioga Downs. Tioga even put together this promo on Youtube:


A few ADWs are supporting HANA on this, including Horseplayersbet.com which is giving an additional 2% reward on all wagers made on Sunday's card.

Update: TrackMaster has made free past performances available for tomorrow's Tioga card.

Shhhh! Golden Gate Quietly Decreases Purses

It appears that Golden Gate has quietly decreased purses. By comparing Condition Book 2 and Condition Book 3, horsemen are now running for less. Bottom level claiming purses are around 2-4% less, while allowance races are lower by 8-10%.

For example, I noticed that an allowance non winner of one other than dropped from $34,000 to $31,000.

I can see why this has been kept quiet, there are a few 3 or 4 letter organizations that have their tails between their legs right now. The infamous takeout hike in California, which put the cart ahead of the horse, has been an abysmal failure. Not only has the higher purses not led to bigger field size (Golden Gate is down around a quarter of a horse per race this year), but it has led to an unprecedented Horseplayers Revolt that may or may not be responsible for the 20% decline in handle at Golden Gate so far this meet.

For sure, there is less value for Horseplayers. Higher takeout means lower probable prices, and they break the regular Horseplayer quicker as well, causing them to pay less attention to racing in general over time.

Santa Anita came out with "their" numbers to date. "They" claim they are only down 7.9% so far this year. But for those watching carefully, including "them," the recent numbers look like a horror story.

In the last four weeks, total handle is off over 20%, while total purse money given out is only up 4%. Two major things here, one is that the Mid Atlantic Co-op didn't start taking Santa Anita's signal until the last week of January last year. This meant that for the early part of Santa Anita's meet this year, Santa Anita had around a 10% larger audience than it did a year ago. Comparing the same potential bettors to the same potential bettors could only be done the last four weeks to date. Here is how those numbers look:

The other important thing to keep in mind is that they have cut Wednesday's out. This means they are giving out more purses per race, but running less races. And lately, the Horsemen, jockeys, jockey agents, etc. have only been competing for 4% more money. How long before they are competing for less money than last year. If the 20% decrease in handle keeps up, it won't be very long at all.

Solutions to California's problem cannot be solved by raising prices to the bettor. That wouldn't work if Wal-Mart was in trouble, and it won't work in horse racing either. The costs to own horses horses need to be cut. No reason why it should cost $100-$125 a day in California and only $55-$65 a day at Penn. Sure, maybe a little higher, but not that much higher.

Lower prices means more owners. Yes, purses are important too, but for many, it isn't how much you win but how much exposure to losses you have.

The powers in charge are very aware right now they screwed up. Hollywood Park owner Jack Liebau met with a huge group yesterday including 3 HANA members.

Craig Walker chimes in about California racing. He says that drastic changes are needed.


WOODBINE CUTS PURSES 2%, BUT DOES IT THE RIGHT WAY
Woodbine's bottom line, as speculated here, was down a bit last year despite a handle increase which bucked the industry trend.

“Even though our handle was up last year a lot of that increase was coming from outside Ontario, which means lower commissions for us, and the contribution to the purse account was minimal.”

Woodbine finally allowed the big rebate shops to take their signal last year. This created larger pool sizes and has helped put Woodbine on the map amongst some of the biggest bettors in North America.

Sadly, they have failed domestically, and this is due to higher than average track takeouts, which their live customers have to deal with.

Woodbine is on the improve mentality wise since David Willmot left the boat and they are doing things right, finally.

Things like cutting the major stake races exorbitant purses to not so exorbitant purses is proof of that. Giving out $1.5 million for the Canadian International instead of $2 million will not hurt the quality of the field going forward one bit. And that is now $500,000 more that doesn't have to be taken away from the domestic horsemen.

Another great move is to move the big races to Sunday, when there is less competition as most of the American tracks card their big races on Saturdays. Now that Woodbine is on the map, Sunday's can be Woodbine's day.

Woodbine has good momentum right now. But now with a very good foundation in place, it is mandatory that they lower takeout rates and start to grow domestically.

Lots Of Excuses But It Boils Down To Track Takeout

There are lots of excuses out there as to why horse racing doesn't grow, and in fact is in retreat.  Online gambling has exploded world wide, while horse racing handle has sunk and continues to sink.  Down another 7% last year.

The economy?  Sure, that might explain a drop off the last couple of years, but what about the 7 years prior to the recession?  More and more people now have the ability to make a bet by computer within minutes of turning a computer on.  

Drugs?  Horse racing has always been plagued by having a negative image due to drugs or race fixing.  Back in the 60's it wasn't enhancers though, but drugs that caused favorites to become sleepy during the race.  Still, drugs in horse racing do not cause current players from betting less.  Sure, they may skip races that have a suspected drug trainer in it.  But they will still bet the same amount they were capable of betting over time.  Bottom line, if drugs were cleaned up tomorrow, it wouldn't create one single Horseplayer, or cause handle to rise.  Those who don't be have no idea what Lasix or Bute is, let alone snail or cobra venom.

Tote Integrity?   Again, this is just an excuse that Horseplayers, who have to lose 18% (when factoring blended rebates) of what they collectively bet.  Odds dropping significantly from one minute to post versus the final odds, are just something to talk about.  The boogieman named "past posting" is probably so insignificant, that to spend oodles of money to prevent it makes no sense whatsoever.  Don't get me wrong, if horse racing is to grow, tote integrity will matter, but it doesn't matter right now.  There are flaws in the system, and most will be corrected by the new TRPB initiative, however, this will not create new Horseplayers or increase handle over time one iota.

Quality?  Yes, Horseplayers generally are attracted to quality races (not me though), however, quality by itself will only be a disaster for the industry.  Small outfits are the backbone of the horse racing industry.  And think of a game where only the best horses get to race?  What happens to breeding?  Less horses by far.  What happens to horses that decline?  Early retirement.  It is hard to keep a quality horse population up when fewer will be  bred and there will be a huge shortage of owners as well.  Not only that, but governments will stop giving horse racing any incentives or allow the game to be subsidized by other forms of gambling because the industry will not have that many jobs in it anymore.
By increasing the quality or getting rid of the "bad" horses, there would be even less Horseplayers today, as small owners bring friends to the tracks, and that creates growth, small tracks create some Horseplayers as well.  The fact is that movie Secretariat and Zenyatta's quest for immortality didn't create one single Horseplayer (so it seems), tells me that quality will not save the game.
Another thing when it comes to quality, most horses bred today have a lot of royalty in their blood line whether they races at Santa Anita or Beulah Park.  Drugs probably hurt the quality aspect more than anything as they seem to cause horses to race less, and even injured earlier by raising the bar on how much faster a horse has to be today in order to compete.

 There is only one thing that will reverse the trend in horse racing, and that is to lower the price of the bet (the takeout).  HANA recently did a piece every racing exec or Horsemen Group's member worth a salt should read:
How Do Sports Bettors & Poker Players Feel About Horse Racing?

In order to optimize purses, an optimal takeout must be sought. Every academic study done on this topic suggests that this takeout should be no higher than 14% and probably as low as 8% for WPS at least.

Another important read is an article on Mike Maloney, someone who bets on horses for a living, he also a VP with HANA.

In the article, he repeats my constant message, that winners need to be created in order for the game (though Mike doesn't mention it, he means winners who don't get rebates). Horse racing needs a Chris Moneymaker. And that is impossible when the blended takeout rate is over 21%.

Another interesting point made by Mike was that takeouts were lower when horse racing was virtually a monopoly. What other industry increases their prices when they are forced to compete?

He also explains that takeout matters even though most people are not cognizant of takeout. Great read.

Bottom line, drugs and tote integrity, etc. are just excuses for why a Horseplayer temporarily loses money, but it is inevitable for them to lose money collectively, so there will always be excuses. Sure, it would be nice if the only excuse they can use is I'm not that good of a handicapper and/or bettor, but no matter the excuse, collectively they will lose.

The important thing when it comes to growth of the game is how fast they lose. The quicker they lose, the least likely they are to come back. The more likely they are to find other hobbies. The longer they last, the more likely horse racing will become a priority in their life, and they have the capabilities to expose their friends and family to the game.

To hook new players quicker, it would help immensely if we had a few Chris Moneymakers as well.

Terminator 6: Death Watch

It is official the takeout increase bill has been signed, California Gov. Arnold Schwarzenegger showed he either doesn't understand basic economics, or he set his common sense aside to appease a group that doesn't understand basic economics.

The takeout hike will most probably go into effect the day after Christmas this year. Although the WPS takeout remains relatively low at 15.43%, daily double and exactor takeout will rise to 22.68%, placing Hollywood Park, Santa Anita, Golden Gate, and Del Mar in a tie for those betting types at around 57th out of 69 tracks according to HANA's up to date takeout data. Triactors and other exotics will go up 3% (which is really 15%) to 23.68%.

HANA reports on the takeout increase here.

Again, I understand the Horsemen who went along with this increase. Why? Because the entire 3% will go into purses. If handle were to remain stagnant, which it won't, monies available for purses would go up 15%. So handle could drop significantly, and the Horsemen will still end up ahead.

Here is an example (using many guesstimates). For every million bet, lets say $300,000 is wagered on WPS, $300,000 on doubles and exactors and $400,000 on all other wagers. Also lets assume that California exports its signal for 5% and 50% of handle is generated from exporting. Also, I believe the Horsemen get 50% of takeout revenues to fund purses.

Using these numbers, prior to the takeout hike, for every million bet, Horsemen receive around $58,000. Assuming signal fees increase on exotics (see Understanding Signal Fees), under the new arrangement, Horsemen will receive around $67,000 per every $1 million.

All source handle would need to drop off 13.5% in order for Horsemen to be worse off.

Any drop in handle up to 13.5% will be absorbed entirely by the racetracks. Which makes me shake my head here at the track owners who have put a huge "Kick Me" sign on their backs by going along with this.

I also doubt very much that the signal fees will go up that much. I can't see Twinspires and other major ADWs or tracks going for such an increase. If signal fees only go up by half the increase on exotics, it will be closer to a 10% decrease that will cause purse accounts to have less collective money.

Handle will drop. The question is how fast, and by how much?

The total effect of takeout increases or decreases normally take time to assess. If a hike occurs, Horseplayers receive less on each bet than they did before. They last less, they go home quicker, they come back less often. Some quit, some find a new hobby or a new game. These players will expose friends and family to horse racing as well. In other words, negative growth is created. Horseplayers collectively won't bet more and reload more just so they could have the same action as before (I believe that there are actually people who were in on this decision that assume Horseplayers do react this way).

I just want to note, that the opposite occurs if a takeout decrease happens.

There are other factors out there. Thanks to HANA and the internet in general, the public is much more aware of track takeout than ever before. There are some really pissed off Horseplayers out there over the action by California, and many of them vow to quit betting California racing. I believe them. I know it would be much harder for someone in California to boycott their own state's product because of familiarity, but for those outside of California, it isn't hard at all.

Personally I stopped playing California the day the bill was signed. Though I will play on Breeder's Cup days. Just keeping it honest. I want horse racing to grow, I love the game, but this move by California racing just really upsets me, and it just tightens the noose around horse racing's neck right now.

And finally, there is one major factor. An estimated 15% of all handle is generated from computer program bettors or sophisticated value players. Not only will increasing the takeout, create less value situations for these players, but increasing the signal fee, even it is half of what the takeout increase will be, will also come into play as to whether an astute rebate player makes a bet or not.

Despite, the flawed argument that bigger purses will lead to bigger field sizes in California (it is flawed because horse racing is experiencing negative growth thanks to not recognizing that the Horseplayer is the customer, and new owners generally get started on a smaller scale, many are Horseplayers first, and the day rates in California are just way too high regardless of the purses), I will predict that within 6 months of the takeout increase, California handle will drop 15-20% regardless of what happens anywhere else.

I originally stated that no good could come out of this in a previous post. Perhaps I jumped the gun a little. Portland Meadows has announced that they are dropping their takeout on Pick 4's from 22% to 14%. Delaware has also decreased their on track takeout on exactors from 19% to 10%.

THE TIME IS RIPE

This is a great time for a track with enough brains and guts to take advantage of the California takeout rate hike by lowering their takeout rates and attracting to begin with, the disgruntled soon to be ex California bettors.

I'd like to think that NYRA, Tampa Bay Downs, and even Woodbine could benefit immensely if they were to do the right thing within the next month or two.


Finally, takeout increases no matter where they originate hurt the game's total growth potential. They kill off the player, albeit slowly and provide zero potential for growth. A player at Hawthorne, for example, receiving $2 less for a $100 exactor he hit at Santa Anita won't feel it immediately, but slowly but surely it takes away his incentive to believe the game is beatable, and besides either coming home with less money than before, or churning one less race because of it, the player eventually becomes more disillusioned though he doesn't really know why.

If that is hard to believe, ask a slots operator what happens to the bottom line if hold is increased by a couple of points.

QUOTE OF THE WEEK:

“(If there isn’t growth in handle), we could end up with two-bit racing and virtual racing. The competition is smart, and it is giving the customer what the customer wants. Racing is still giving the customer what racing wants.”

UPDATE: About the movie Terminator 6. The year is 2029, and there has been no horse racing in California for 12 years. The Terminator's assignment is to go back in time and destroy Arnold Schwarzenegger the day before he signs the takeout hike.

Inspired By HANA, Pinnacle Race Course Lowers Takeout On Exotics

It isn't a shocker that racetracks are now starting to pay attention to the customer. Handle is dwindling, in May handle was down 8.3% from the previous year.

Simple Business 101 demands that when demand decreases, prices should come down. In horse racing, the price to the consumer is the track takeout. If a track is in trouble and they don't lower takeout, they aren't trying.

Pinnacle Race Course is trying. From Director of Pari-Mutuels/Simulcasting, Laura Bennett: "In response to the Horse Players Association of North America (HANA), we have lowered our take-out rates to the "lowest in Michigan".

More Money To The Players: "Win, Place, and Show are set by the State at 17%. All other pools are by track choice. We have lowered all our other offerings to 20% except Trifectas and Superfectas which have lowered to 25%.

Before this takeout drop, Pinnacle Race Course ranked 64th out of 69 tracks in North America for takeout score. Takeout rates were 17% WPS (unchanged), 20% on doubles (unchanged), and 27% on all other bets (they dropped the takeout by 7% on exactors, and 2% on all other bets).

With Tracknet dissolving, Pinnacle will be able to broaden their distribution to all ADWs.

I hope tracks like Fort Erie are taking note. Horseplayers who get more money back on each bet will last longer, and they are more apt to come back and play quicker. Lower takeouts also attract price sensitive players who may have avoided the track in the past.

Fort Erie takeouts are the second worst in North America. 16.95% on WPS, 26.2% on all other bets except for triactors which have a takeout of 28.2%. Their handle sucks this year. And it is a big year for them as they attempt to turn the joint around. If they don't address the track takeout issue soon, they simply aren't trying. 26.2% on exactors and doubles is simply obscene.

Lowering track takeout isn't an overnight fix, but the sooner they drop it, the quicker the process to build up their customer base begins.

To join HANA click here, it is free, and only takes a minute or two.


There Is Actually A Chance That Woodbine and All Ontario Racetracks Will Lower Takeout Soon

As mentioned here previously, Nick Eaves, the new top banana at Woodbine Entertainment is making it a quest to get the Ontario Horse Improvement Plan funded by slots and not by bets on horse races:

"He wants an immediate reduction in the takeout – 2 per cent on straight bets and 4 per cent on trifectas he calls “a start’’ – by removal of the current tax that goes to fund the Ontario Horse improvement Program, suggesting that worthy plan be funded by general slots revenues."

This would be great for Woodbine, which has some momentum going lately thanks to exposure at TVG and having their past performances being part of the Daily Racing Form Eastern edition in the USA. Woodbine also for the first time in at least recent history, can now be wagered on in Las Vegas. 83 Casinos can now put Woodbine on their betting menu.

If this does come to fruition, and Woodbine didn't come up with some excuse to not cut the takeout by the full amount of the HIP tax, Woodbine's takeout on WPS would be 14.95%, which would be the lowest in North America. 18.5% on Exactors and Doubles would tie them for the lowest in exactors (on the thoroughbred side), and tied for third for daily doubles.

I would hope that all harness tracks in Ontario, Ajax Downs and Fort Erie would also drop takeouts by the same amount as the HIP tax as well. But they could do what Woodbine did a few years when the government opted to lower taxation on wagers from over 8% to 1.3%, and foolishly keep takeout the same.


As for being able to allow bettors to play single sports games, I don't see the idea of Woodbine being a bookie flying. Unless it is set up in a parimutuel way, there is risk. And if they charge anything more than 10% juice, they won't attract enough action to make it worthwhile.


Bennett Liebman, has written a very good article in The Post (The New York Times Blog): Reasons For The Decline of Horse Racing.

All his reasons are significant. Although I will argue that his first reason cited, "Other Forms Of Gambling" is very much related to his ninth reason "Track Takeout" which could be combined to be the major reason for decline: Horse Racing's failure to compete with other forms of gambling.

As he points out, horse racing is a game of skill with an onerous collective takeout. There is no real reason for a newbie to get started, and little reason to stay:

"When you hear from the major rebate shops, that without the rebate, even their most skilled players almost never beat the takeout, you wonder why you play the game."

The bright side is that even smaller bettors can now can decent cash bonuses on their bets if they shop around.

There are additional reasons for the decline in horse racing. One that a commenter brought up is very valid, and it has to do with the short racing span of today's superstar horses. Frying 2 and 3 year olds, while taking the best out of competition and putting them in the breeding shed, has made it so that fan favorites come and go way too quickly.


Churchill Downs Inc. Has Completed The Merger of Youbet with Twinspires
It will be interesting to see what platform and features the keep, and which they get rid of in the near future.

Horse Racing Needs To Try Optimum Pricing Before Cutting Dates

Nick Eaves was recently on Trot Radio, and what he had to say was not very popular amongst harness horsemen in Ontario at all. He has pretty much concluded 100% that harness racing (even Woodbine Mohawk) needs to cut dates because there just isn't enough demand for the product.

I'm not saying there isn't too much harness racing in Ontario today, but what gets me is that the element of pricing is huge when it comes to demand, especially today when there are all kinds of competition in the gambling industry.

How can a reasonably intelligent sounding man, who runs a gambling empire avoid Economics 101 so much? It isn't just Eaves, but his predecessor as well, and virtually almost every race track exec in North America.

To date, Woodbine Entertainment has not even attempted to find the OPTIMUM PRICE when it comes to takeout. Surely, a company that sells a product (gambling) in a competitive environment has to understand that at different track takeouts, you end up with different bottom lines.

Take McDonald's for instance, they know that if they charge $3 for a Big Mac, they make more money in the long run than if the price was $6 or even $1. This happens with experience of moving prices up and down.

The slot industry has found out the OPTIMUM PRICE as well through trial and error. Of course, it can be a little different in one place than another, depending on the customer base, but it generally always falls between a house take of 5% to 10%.

At 15% or 20%, even though the patrons mostly don't have a clue about the slot payback rates, slot operators make less money in the long run because players go broke quicker, which works towards giving them a stronger negative experience. After all it is gambling, and if you walk into any place with a bankroll and lose it too quick, you'll find other ways to bet or quit betting altogether.

The longer a player lasts, the more apt they are to expose friends and family to their gambling habit. This increases the bottom line of the casino....or hopefully, the racetrack when they finally discover OPTIMAL PRICING. Again, lowering takeout in horse racing is a long term thing. It isn't an overnight savior. It took 30 years for racing to find the bottom, now it is time for it to rise up again. Lowering takeout will help the momentum.

Seriously, how can Keeneland have takeouts between 16%-19% and Woodbine have takeouts between 17%-27% if OPTIMAL PRICING has been attempted?


THE COST TO PUT ON THE SHOW FALLACY

One of the biggest crocks heard is that racing can't drop takeouts because the price of putting on the show is too high.

Takeout price and the cost to run a track are two separate entities. The best way to illustrate this is using a slot operation.

Slot operations are not cheap to run. Many are open 24 hours a day, 7 days a week, and employs many full time staff (employee benefits, maternity leave, etc.). It takes a lot of electricity to run these places as well. Lets say it costs $25 million a year to operate a casino, and lets also assume they at least break even at every hour of operation, so there is no need to cut hours. The casino has an average house take of 8% on their slots. This means, to break even slot players must bet at least $312,500,000 a year. At 8% they do find that people bet $450 million a year (yielding a profit of $11 million). However, at 10% where the break even point would only be $250 million, they find that people bet only $330 million, which yields a profit of $8 million.


Now what does the cost of the operations have to do with how much people will bet? Simply, it doesn't mean squat. The slot operator, using OPTIMUM PRICING, realize that they make more money at 8% versus a 10% hold. The cost of the show is irrelevant, it could be $25 million, $10 million, or $35 million, it just doesn't matter. It is all about the the takeout rate or hold rate, and how much the customer loses collectively at different hold rates.

More of today's customers are aware of track takeout when it comes to horse racing, but even if they weren't, the psychology of losing too fast will always be there. Horse racing needs to attempt to find the OPTIMUM PRICE point. Cutting dates first is just giving up without even trying, and just putting a band aid on the demand problem.

In the Trot Radio interview, Eaves also made mention of the HIPS 2% (4% on triactors) tax that increases the takeout, a horseplayer has to pay. I think it is a great idea to change the way HIPS is funded, and take it out of slots instead. A 2% decrease on WPS and exactors and doubles would be great, if Woodbine can pull it off. A 14.95% takeout on WPS would be the lowest in the land, giving them a fantastic competitive edge.

More importantly, getting rid of it off the parimutuel side would enable Woodbine to experiment with other takeout reductions more easily as well.

I don't get his churn comment? Of course, in the old days when there were fewer exotics, and a lower collective takeout because of it, churn would be higher. But to say churn isn't that good anymore is a bit misleading. Horseplayers generally bet until it is all gone. They might play other tracks, but that is how it works.

Also, the polytrack has led to bigger average payouts (thanks to bigger fields and the fact the polytrack creates more chaotic results than dirt), so fewer people are getting money to churn. So it might take the player who cashes a big super or tri longer to churn back, but they generally do so over time (the churn is coming back from fewer sources than in the old days). And the best churn days are when exactors pay $20 and winners pay a fin. But again, with most of the money coming from simulcast or ADW, people will generally bet the next race coming with the money they cash, regardless where they cash it, so sometimes Woodbine benefits, and sometimes it doesn't. It should be a wash in the end regarding timing of players cashing and betting back.

When you take out $25 out of every $100 bet versus $16, there is going to be a lot less churn regardless. That is the bottom line.


HANA at Keeneland On Youtube
I'm proud to say HANA is getting the exposure it deserves. We are starting to get a seat at the table, and I think our efforts are beginning to pay off, as tracks have actually come to us and ask for suggestions (and why not, we represent the customers, the people who pay for the purses and the track operations):



Incidentally, HPITV viewers may recognize Mike Maloney, as he has shown up on a video that HPITV airs having to do with handicapping.


Advertisement

MONMOUTH PARK'S BIG SEASON IS JUST ABOUT TO BEGIN: WATCH AND BET IT AT HORSEPLAYERSBET.COM AND EARN GREAT PLAYER REWARD BONUSES AS WELL

INTRODUCTORY OFFER FROM HORSEPLAYERSBET.COM

BET $100 GET $50 DEPOSITED INTO YOUR ACCOUNT*

*Open up an account and deposit at least $100 in total. Once you wager $100, you will get $50 deposited into your account the very next day. You will also start receiving the regular Excellent Player Reward Bonuses on anything you bet in excess of the initial $100 going forward. Note: To earn the $50 Bonus you must wager at least $100 in total within 7 days of making your initial deposit.

CLICK LOGO TO OPEN A FREE ACCOUNT



Why Horseplayersbet.com:

* EXCELLENT PLAYER REWARDS added to your account weekly.
* User friendly betting interface making wagering easy.
* FREE LIVE VIDEOS.
* FREE RACE REPLAYS.
* Wagering Online & by Phone.
* Great customer service.
* 100% Parimutuel.
* No membership or wagering fees.
* No fees on debit or credit card deposits of $100 or more.


Horseplayersbet.com, WHERE HORSEPLAYERS COME FIRST. SIGN UP TODAY

Player Reward Bonuses could be the difference to you as to whether you win in the long run playing horses or lose. The better the rewards, the more of a chance you have to beat the game. Sure, you still need skill and luck as well to succeed, but at HORSEPLAYERSBET.COM at least you have a fighting chance. And one thing is for sure, your money will last longer because of the PLAYER REWARD BONUSES you receive.

HANA's Track Rating Resource: Great For Horseplayers And The Industry Alike

HANA (Horseplayers Association of North America) has published their 2010 Thoroughbred track ratings. It is a great player and industry resource, with sortable columns for up to date track takeout for most wagers as well as sortable columns for things like handle per race and field size. The current blog piece is a focus on tracks with the lowest takeouts.

It is pretty amazing that 12 of the top 16 track's with the lowest takeout score have no alternative source of gambling. This isn't true when it comes to the bottom ranked tracks, which are dominated by tracks that have slots. Woodbine and Northlands Park tie for 58th spot out of 69 tracks when it comes to highest takeouts, while Fort Erie finds itself pathetically in 67th spot on the list, bettering only Suffolk Downs (68th), and Assiniboia (69th).

The industry is not taking HANA's work lightly lately. It is in panic mode, and I think the message that it is the horseplayer that is the customer, and only the customer, is beginning to become a reality, and it is about time the industry find out how the customer thinks, and works with that knowledge instead of the old way which is how the industry wants the horseplayer to think.

HANA is getting lots of press. Check this out.

To join HANA, simply click here, it is free, and it only takes a minute.



Gaming revenues in Nevada jump almost 14% in February
So what is horse racing's excuse? Total handle on US races declined over 6% in March. That followed double digit declines in January and February compared to the corresponding months the year before.

Horse racing has still not bottomed out yet, and still, next to nothing has been done to address the pricing of the bet, in order to compete and grow again. Proving once again, that racing is one of the most, if not the most, dysfunctional industry in the Western world.

Cutting race days or purses is a band aid solution, and as this trend continues, horse racing will become less of a concern, not only by the public, but also regarding government subsidies.

On a related note, if Woodbine is not careful, they will soon have their slot subsidies questioned, as more and more American outfits usurp the Canadian outfits thanks to Woodbine's effort to attract Americans by carding American bred friendly races such as B Allowance races. And more importantly, not carding Ontario bred claiming events and even worse, continuing the new practice of not allowing the owner of a newly claimed Ontario horse run for the full purse.

It is almost like Woodbine is telling the owners, go get a superior Kentucky bred, bring it here and race it. It is a lot less risky than buying an Ontario bred either at a sale, and of course, unless you think a newly claimed Ontario bred can win an Ontario sired allowance race, don't even think about claiming one.

There are two existing components of growth for betting: The existing horseplayer, and the existing owner. Owners and horseplayers are the one's who will likely expose newbies to the game (friends, relatives, and sometimes coworkers and neighbours). The horseplayer in Ontario has been ravaged for years by high takeout. Many have left to play poker, Betfair, or are now wagering offshore with bookies or rebate shops. Now the horse owner and breeders are really feeling Woodbine's corporate mentality of trying to attract more quality (even though studies have shown that quality means very little compared to pricing when it comes to handle). We are seeing less and less new Ontario owners come into the game through partnerships or as lone entities, and it all boils down to Woodbine having little understanding of who the real customer is.

Forum Question: If you won a $5 Million Lottery would you continue to bet on horses? Not one NO so far. Horseplayers sure are either passionate and/or addicted.


CHANTAL'S BACK

CHANTAL'S FRONT

Seriously though, Chantal Sutherland is back at Woodbine. She is listed to ride a couple of horses this afternoon (Friday) at Woodbine.


Beulah Park's 25 Cent Fortune Pick 6's jackpot has climbed to $307,465 going into Saturday. You can bet it here, if you live in the right State.

The Beulah Park Fortune 6 May Be The Idea That Saves Racing

The jackpot for the Beulah Park Fortune 6 has grown to over $200,000

Now, don't just bet it without knowing the rules first. In a nutshell, it is a 25 cent base bet. This means that a horseplayer can take 2 horses a race and the total bet will be only $16. But there is a catch: The jackpot is paid out if there is one single winner. This means that if you are the only winner, but have it for 50 cents or more, you don't win the jackpot. So it is very important that you don't duplicate your wagers if your goal is to win the jackpot.

They do give out 40% of what is wagered (after takeout) each day if the jackpot is not won, and distribute it to those who have the most winners (lately that has been those who had all 6 winners).

If you do have lots of chalk, it doesn't hurt to try to get it multiple times with the jackpots as high as they are now, and if you take into consideration that the last three days, they attracted over $60,000 each day in new money, which means that after the 22.5% takeout, over $18,000 has been distributed each day, while another $28,000 has been added to the jackpot on average daily.

The Beulah Park Fortune 6 is a carbon copy of Puerto Rico's Poolpote wager. It is tremendously popular in that country, as it has a 35 cent minimum so again, it is affordable by all. It was recently won in March, and the winner received close to $5 million dollars on a ticket that cost $10.30.

So how does a 25 cent or 35 cent bet grow to be so large and get so much play at C or even D tracks? The beauty of it is that the larger it gets, the less likely it will be won by one bettor, especially with the short fields Beulah has been offering of late. It is a Catch 22 that works in favor of the race track. The small players are attracted to it like bees to honey. And the pools are big enough to attract the medium player who might be interested in sharing the daily pool money with a shot at the big one.

As the jackpot gets higher, the lottery and slots crowd start to get attracted to it, and tracks like Beulah may start to see an influx of newbies. And another key point is that some every day horseplayers who don't usually look at a track like Beulah, are now handicapping 6 races a day there. And as many horseplayers know, once you handicap a race and form an opinion, you are likely to find an exactor or triactor, or many of each, to play on the card as well.

This is an obvious way for smaller tracks, especially harness tracks, which are really struggling each day to try to build their customer base back up again.

As for tracks doing this, there could be a few problems right from the start to set this up, depending on the jurisdiction. In Canada, this type of bet would require CPMA approval, as it is a different way to distribute pools. It may be a lot of red tape, it may not be.

The biggest problem is the minimum. If you are an American and bet through an American ADW or track or simulcast center, you wouldn't be able to place a bet on a Canadian jackpot bet unless you play it for at least a dollar, which means that you wouldn't be eligible to win the Canadian jackpot. The same is true for Canadians betting a US jackpot bet. Canadians must bet at least a dollar base bet on US product through HPI, or Canadian tracks and simulcast centers.

American tracks really don't have to worry about Canadians because a jackpot can be build without Canadians playing it, but Canadian tracks have to worry about getting Americans to play their jackpots because that is where much of the potential money to build the bet up will come from.

Even though the Canadian dollar and US dollar are close to par, the rules are still there regarding fractional betting, and it is maddening for many horseplayers, especially Canadian ones, have little option but either skip these bets or play them for a dollar base.

Take Fort Erie for example. Here is a struggling track that could benefit immensely from this kind of bet. But since they can't use the quarter base for reasons cited above, I would suggest to them that they do a $1 base Pick 5. If you don't think the Pick 4 is hard enough to cash at the Fort, just ask Daryl Wells Jr. and Elissa Blowe. A Pick 5 would be just about right, if you want to compare it to the Beulah bet.

For the complete Fortune 6 rules, click here.
If you live in the right jurisdiction, you can play the Beulah Fortune 6 here.
See also Fugue For Tinhorns: That Deceptive Juicy Beulah Carryover



I am two days late with this news. I just saw it at Pull The Pocket. Brilliant, brilliant idea. In case you missed it, Hollywood Park is going to make identifying your horse in a race, way more easier. It will be great for the newbies, and even veterans like myself who lose the horse you are watching during the race. Well, this won't happen again at Hollywood Park:



Woodbine opened up yesterday and they barely did over $2.1 million in handle. I don't think that the slot subsidies Woodbine receives from the OLG was meant to go to short fields with big purses won by US connections. Keeneland opened up yesterday too. They also had 10 races, with shorter than usual fields as well. The thing is they did around $7.5 million in handle. Three and a half times more than Woodbine.

Here is a track with no subsidies from alternative forms of gambling, and they maintain the lowest takeout average in North America (tied with Churchill Downs): 16% on WPS, 19% on all other wagers. Woodbine, with slots, gives has track takeouts that range from 16.95% on WPS to 27% on triactors.

HANA (Horseplayers Association of North America) just put out the 2010 final rankings of 69 racetracks. Keeneland was number one on the list for the second year in a row, while Woodbine ranks 30 overall, and even worse, their takeout rank is 58th.

Today's Woodbine card is embarrassing: 65 horses in 10 races.

Fair Grounds handle was down 19.5% last meet
Blame it on cancellations, turf races coming off the grass, and the Mid Atlantic dispute. But the main reason is most likely the squeezing of the emerging rebate player. High distribution fees coupled with Tracknet's ridiculous limitation on horseplayers who bet less than $1 million a year, by not allowing them to receive a rebate of more than 2% no matter where they are playing, is the main reason many medium size gamblers have been playing tracks like Tampa Bay Downs instead.




CURRENT PROMOTION FROM HORSEPLAYERSBET.COM

BET $100 GET $50 DEPOSITED INTO YOUR ACCOUNT*

*For new accounts only. Open up an account and deposit at least $100. Once you wager the $100, you will get $50 deposited into your account the very next day. You will also start receiving the regular Excellent Player Reward Bonuses on anything you bet in excess of the initial $100 going forward. Note: To earn the $50 Bonus you must wager the $100 within 7 days of making your initial deposit.

CLICK LOGO TO OPEN A FREE ACCOUNT



Why Horseplayersbet.com:

* EXCELLENT PLAYER REWARDS added to your account weekly.
* User friendly betting interface making wagering easy.
* FREE LIVE VIDEOS.
* FREE RACE REPLAYS.
* Wagering Online & by Phone.
* Great customer service.
* 100% Parimutuel.
* No membership or wagering fees.
* No fees on debit or credit card deposits of $100 or more.


Horseplayersbet.com, WHERE HORSEPLAYERS COME FIRST. SIGN UP TODAY

Player Reward Bonuses could be the difference to you as to whether you win in the long run playing horses or lose. The better the rewards, the more of a chance you have to beat the game. Sure, you still need skill and luck as well to succeed, but at HORSEPLAYERSBET.COM at least you have a fighting chance. And one thing is for sure, your money will last longer because of the PLAYER REWARD BONUSES you will receive.

Tioga Downs Doing It Right, Monmouth Park Doing It Wrong

Tioga Downs put out a press release yesterday that they are intending to lower their track takeout from 18% on WPS, 20% on Exes and DD's and 25% on Supers to 15%, 17%, and 21% respectively. Tioga actually gave HANA (Horseplayers Association of North America) a seat at the table and asked for input a while back leading to this news. Yes!, some track execs do read blogs and message boards and actually take them seriously.

All studies show that if takeout is reduced, handle and the bottom line for the track and horsemen will rise. It usually doesn't happen overnight, but lets see what happens here. I haven't played harness racing in years, but I will support this takeout drop, and if I start cashing tickets, I'll give them even more action. Free past performances would be a huge plus for Tioga to make available.

A couple of quotes by Jason Settlemoir, Tioga Downs VP of Racing and Simulcasting:

“The USTA recently polled visitors to their website and 1,259 out of 1,710 people who voted (roughly 74%) responded they would be more apt to bet races if a track lowered their takeout rate."

“We would even consider going lower on the takeout rates to between eight and nine per cent like the typical hold in the casino world if the state would allow us, and our export sites would be on board."

New York state, or any jurisdiction for that matter, has no business putting a minimum on what a track wants to charge. As for ADWs and tracks not taking Tioga's signal, Settlemoir is correct to be concerned that hardly anyone (if anyone) would take the signal at 8 or 9% in today's market. I don't see why any track would refuse Tioga's proposed structure though....well, Canadians will be out of luck I think if they want to bet Tioga through HPI, and even if HPI did have it, they would base the triactor and superfecta payoffs as if the takeout was somewhere between 25-27%.

Horseplayersbet.com will most probably have Tioga Downs on the menu, and strong Player Rewards will be earned on all bets made.

Tioga Downs President Jeff Gural is currently attending the TRA/HTA conference in California. Attendance is very light apparently. A couple of quotes from Mr. Gural:

"...the race tracks that don’t have slots aren’t here because they can’t afford it. Those that do have slots aren’t here because they don’t care about racing any more.”

“If you’ve got slots,” the pari-mutuel revenues are a drop in the bucket. Why offer slots with an 8% takeout and then charge people 20% to bet on racing?”

He is 100% correct on both accounts. The Pennsylvania Gaming Control Board has demanded that Pennsylvania tracks like Philly Park and Penn National demonstrate “concrete ways their commitment to live racing and breeding.” These tracks have been accused of not giving a rats ass about horse racing as it has now become such a small percentage of the bottom line thanks to the expansion of gaming at the tracks in Pennsylvania. Horse racing appears to be a necessary evil there and other tracks throughout North America that have slots.

Personally, I find it disturbing that tracks with slots seem to have the highest takeouts in most cases. Tioga Downs is definitely doing the right thing by going the other way.

See also, Tioga Downs' Bold Move.


Monmouth To Cut Racing Days In Half While Tripling Purses

They actually think that giving out a million a day in purses will lead to doubling the handle. Not a chance!

A study done in 1998 concludes that doubling purses will cause handle to go up by 6%. Lets say the study is a little outdated because the environment has changed because a higher percentage of betting originate off track. And there is also the problem that this study doesn't take into account the effect of reducing dates, which will probably create a larger than normal live handle. OK, so we might see handle increase because of purse size in the neighbourhood of 15-20%. However, betting is down around 10% this year so far.

Saratoga is still going give out $750,000 a day in purses. This means that quality will be diluted. I can't see many California horsemen being lured to Monmouth, considering Saratoga didn't seem to lure many horses during current past meets.

Monmouth may hurt tracks like Woodbine, keeping a few Americans home and luring the odd good Canadian horse or two. But when you look at speed figures at Woodbine last year in general, even with their good purses, there wasn't much quality there to begin with. And Woodbine only averages a little more than $2 million a day in handle.

And how much quality is there in New Jersey bred races no matter what the purse is? There will be at least a couple a card on average.

Bettors don’t care if owners make more money, they generally are attracted to familiarity (something that is lost in horse racing because good horses retire too early), actual quality, and field size.

I prefer betting non winners or two or three races with a field size of 9-12 than a Stake Race where horses are coming from all over.

The biggest problem with this whole line of thinking by Monmouth is that it is just a way of living with a shrinking pie. This will not lead to growth. In fact, it is just adding fuel to the fire.

Less races equals less owners and trainers and horses. And this inevitably means less growth. The two biggest assets the horse racing industry has is its existing bettors, and horsemen (owners in this case). Horseplayers who last longer betting are more likely to expose others in their inner circle to horse racing. Owners, especially smaller partnerships, are more likely to bring friends and family to the track in hopes of getting their pictures taken. The more they race, the more likely they are to bring friends and family. The more friends and family go, the more likely it is that some of them become semi-regulars or even regulars.

I just don't see this Monmouth experiment working. They would have been better advised to reduce takeout, but they didn't confer with HANA, so they went this way instead.


HANA now has over 1500 members.
To join HANA (free to do so), click here.



TRACKMASTER has made their blog a lot more reader friendly. Check it out.

Triple Dead Heat has a couple of neat posts up. An interview with Centennial Farm's Brandon Boone on Queen's Plate hopeful, Captain Canuck, and a really nice photo essay on Windfield's Farm.


University of Arizona Race Track Industry Program student is doing a Master's Degree Thesis Project: "an attempt to develop a new model that takes into consideration this open market system. I am attempting to show that sound economic principles and techniques can be applied to modern pari-mutuel wagering to show the effects of altering the takeout rates."

Should be interesting. His blog will be updated with findings.


I don't do much on either Triple Crowns. But Triple Crown Chase, a blog run by a horse owner in New York, who races his horses mainly at Fort Erie, does. Check out Triple Crown Chase.


After 5 months, Quebec horseplayers can now go back to betting through HPI, because of the promise to run a short harness meet later this year.
Oh, and they are going with a ridiculous average takeout rate 23% takeout rate instead of a super-ultra ridiculous 30% takeout rate, which probably helped them get into the spot they found themselves in to begin with.

For Quebec horseplayer's sake, I hope many discovered there are plenty of ways to bet on horses and get a much much better deal than betting through HPI the past 5 months.

BTW, if you think thoroughbred takeout is high, which it is, takeout rates on harness racing B tracks in Ontario are sickening, oh, and they have slots...ahem.


Gas Soaked Slots Customer Causes Woodbine Slots To Miss A Night Of Revenues. You have to be crazy to play slots. I'm surprised this doesn't happen more often.

Los Alamitos Handle Down 25% First Night After Takeout Hike

Last night, handle at Los Alamitos was $577,000. Compared with last Thursday night, which saw $767,000 bet, handle was off by 25%. Yesterday was the first night in which the new 2% takeout hike on all wagers was implemented.

The weather may have contributed a little, but out of state wagering on Los Alamitos was off $120,000 (26%). This has nothing to do with weather, and all to do with player protests. Price sensitive players especially saw their potential profits drop, and those receiving rebates saw the net takeout rise on Los Al, which means that other tracks that don't increase track signal fees, look more attractive.

Had we seen a takeout increase that was not publicized, we would have seen very little change last night. That being said, had it not been publicized, over a few months we would see handle drop off because players would not have as much to play with.

Prior to HANA's (Horseplayers Association of North America) inception, Calder raised takeout in April 2008 with little publicity. I did pick up the news and wrote "Calder Raises Takeout: What Imbeciles."

So what has happened to Calder since?

Calder's handle 2007 $490 Million (172 Dates)
2008 $378 Million (160 Dates)
2009 $334 Million (152 Dates)

In today's climate, the takeout increase will affect the Los Al regulars the most and contribute to bettors playing less, where some may take bigger breaks from the game and again.

I stress this, when they are not playing, there is no likelihood they will bring others out with them and that they will not expose others to the game period. This hurts short term handle and long term growth as well. This is what happens when you move away from optimum takeout rate (which according to studies is 12% or lower).

I do think that HANA has made takeout a big issue to players who may have not been cognizant of it a year or two ago, so more people are getting it.

Gamblers are always looking for excuses why they don't win. They blame themselves for making wrong decisions, they blame the ride, they blame drugs, disqualification which are all valid, but all the above would be a lot easier to overcome if takeout were reduced.

Players generally don't say they are losing because of the takeout, because that would mean that they should question why they are betting horses in the first place.

Before last night's slaughter, Los Alamitos track owner, Ed Allred, was quoted as saying "This is something that's alien to my thinking," said Allred, a noted bettor and horse owner. "This is a sad thing for me to do......If this is a disaster, I'll be the first one to change it," Allred said. "The night simulcasting is hurting."

I feel sorry for Allred, however if a track is hurting to begin with, it needs to try to lower takeout. Perhaps this experiment will teach track owners and execs a lesson in Economics 101.

It should be noted that new Chairman, Keith Brackpool, of the CHRB, was the only person who voted against the takeout hike (which passed in a 6-1 vote). Unfortunately his vote was worth as much as Bo Derek's vote.

In a recent interview he said, "It's a slippery slope, I don't like it."

I think it is important to note that yesterday's protest was not a protest against the takeout rate (Los Alamitos' rate is still lower than many other tracks out there), but a protest against the hike, and it was not intended to be a one day event. Time will tell if it was a knee jerk reaction by angry players, or if they will keep it going until the takeout change is reversed.

It would be great if it is the latter. It is about time that horseplayers got together and said WE'RE NOT GONNA TAKE IT ANYMORE:

To join HANA, sign up here, it is free to do so, and the more members HANA has the more HANA will have a seat at the table going forward.

Interesting observation regarding Tracknet and their attempts to increase rates that tracks and ADWs pay for their product.

There could be a shift going on amongst price sensitive players from Tracknet tracks to non Tracknet tracks, because non Tracknet tracks allow the player's bottom line takeout rate to be much lower in many cases. They are feeling the squeeze, and other options are readily available.

I've noticed that Tracknet tracks are not doing so well of late when it comes to handle. For example, Fairgrounds all source handle was down 31% in November and 28% in December.
Much of the blame has to do with the fact that the Mid Atlantic Cooperative's refusal to sign a deal with Tracknet mainly because Tracknet wants to increase the fees it charges for its tracks.

In the meantime, horseplayers are learning that other race tracks do exist, and their signals are available almost everywhere. Tracks like Tampa Bay Downs, which reduced takeout on a few bets this year, have been benefiting from this and the fact that it looks like the horseplayer has finally woke up.

It will be interesting to see what happens in the coming months.

UPDATE: A couple hours after I posted this, Tracknet and the Mid Atlantic Cooperative have come to an agreement. It is hush hush as to who caved.

Los Alamitos Ups Takeout Rate; HANA Not Pleased

In a new world where it is more than apparent that high takeout kills growth and leads to date cuts and lower purses, the CHRB in its infinite wisdom, voted to increase track takeout on all bets by 2%. The takeout increase goes into affect on January 21st.

HANA (Horseplayers Association Of North America) President Jeff Platt was at the meeting and offered this gem:

"Bo Derek and I got into a brief argument where she said that even after the takeout increase, prize payouts (takeout) would still be more favorable for the player at Los Al than slots or blackjack prize payouts at a local casino. I corrected her saying that WPS takeout after the increase would be 18% returning 82 cents for every dollar wagered vs a slots return of 91-92 cents per every dollar wagered. She told me I was wrong. It was only after John Harris corrected her that she shut up."

Jeff, of course is correct. Shouldn't those who vote on such issues as takeout hikes at least have basic knowledge of competitive takeout rates?

Looks like the gloves are off. HANA has circulated a letter written for Jeff Platt by another HANA member to its membership (which is at around 1500):

An Open Letter to Los Alamitos Horseplayers

Last week HANA Pres Jeff Platt spoke at a CHRB meeting in opposition to a proposed 2% takeout increase at Los Alamitos. The CHRB Board, despite the evidence presented that an increase in takeout rates would have a negative impact on handle and revenues, decided to institute the raise. They also included a review process, where by the CHRB would from time to time review Los Alamitos handle numbers between now and Sept 8th, 2010, in order to monitor the effect of this takeout increase on handle.

If the handle numbers come back weak, and show that horseplayers are reacting negatively to this takeout increase, there is a high likelihood it will be rescinded. If the handle numbers come back unchanged, there is a high likelihood the takeout increase will be made permanent. It is also likely, in our opinion, that if Los Alamitos handle is strong, that other California tracks will follow suit with takeout raises of their own. We know this would have a very negative effect on you, as a horseplayer, and in return on California Racing as a whole.

You, as a Los Alamitos bettor, have a very big say in all of this. Each dollar bet at Los Alamitos is a vote for making the takeout increase permanent, and a vote towards seeing higher takeouts across California. Each dollar withheld from Los Alamitos is a vote towards rescinding this takeout increase, and discrediting the notion that racing's revenue problems can be solved by simply raising the price of an already overpriced product. You are in the enviable position to have a direct and measurable impact on the future of California racing, and to make a statement on behalf of horseplayers everywhere.

We ask you to consider these facts, and we trust that your actions and decisions will help to bring about a better and brighter future for this game.

Please pass this message on to fellow horseplayers everywhere.

Jeff Platt

President, HANA

To join HANA (it is free), click here.


Woodbine Entertainment Shuns Flamboro Downs For Louisiana Downs.
Business over long term growth has been Woodbine's MO for quite some time. In order to grow the game in Ontario, Ontario content is a must. It gets owners, co-owners, families of owners and other horsemen involved. If you show local racing, you might plant a seed in someone who will eventually either become a medium to big bettor and/or a new owner.
But the reality is that Woodbine has bigger and better handle on some American tracks, so they are now getting preference on HPITV.
I wonder if home market comes into play too. I'm pretty sure that Woodbine doesn't make as much from someone betting in Flamboro's home market no matter what track they bet on versus someone betting from the Woodbine home market. And they probably make more money if their home market player bets on a US track over another track in Canada that they have to pay a bigger split to.
If this is true, we might be seeing less and less Canadian content, with the exception of Woodbine and Mohawk.
I wonder if Fort Erie is a candidate to get bumped in the summer. Time will tell.

Woodbine would love Woodbine and Mohawk to be the only tracks in Ontario. Slot revenues are standing in their way though. But they might do everything in their power to make it happen just the same.


I wonder how many Youbet customers got this notice


I meant to post this awhile ago. Keeneland Library has a project going on to try to save the Daily Racing Form archives. Watch this:

They still have a ways to go but they do have quite a few Racing Forms archived already. Check it out.


Oh yeah, if you watch sports new on TV you may have missed it, Rachel Alexandra beat Zenyatta out as horse of the year. I was wrong again. This means the odds are with me next time? See what happens when you read too much Bo Derek.

A quote from a friend of mine regarding the coverage of HOY:

"I watch Sports Center two times a day. An hour in the morning when I am on my treadmill or stationary bike and an hour at night when I go bed.

Yesterday was one of the racing industries biggest days as far as the press is concerned. It was horse racing's Oscars, its Golden Globe, horse racing's awards night. In the 60 minutes this morning it received 8 seconds of time when they announced in passing the Horse of the year. That was it – less than 10 seconds. A snowboarder who was scheduled to be in the Olympics had more air time because he crashed his three wheeler and was now out of the games."

Time For Horse Racing Industry To Put Up Video Archives

Partymanners Youtube account suspended
Most racing enthusiasts know by now that Partymanners recently had his Youtube account suspended.

Over 1500 videos of historical stake races are no longer accessible to the general public. Why? It appears that some egotistical maniac had a hissy fit sent Youtube a false claim that at least some of the videos were owned by him. Of course, this is not the case. These videos belong to the racetracks, and as far as I know, most if not every racetrack has to be aware of Partymanners Youtube channel for quite a while, and obviously had no problem with what he was doing. This channel definitely was free advertising for horse racing in general, and I think racing execs would be foolish if they filled out a form crying copyright infringement.

Partymanners has issued a counter claim, which will probably win out if the other guy can't prove he has the copyright to the videos. I'm pretty sure at least the first move by Youtube was simply an automated response. It is actually illegal to claim that you own the rights to a video you don't own the rights to.

This situation has now started to get many horse racing fans to ask why is it that a fan (Partymanners) of all people had to be responsible for bringing great historical races to the general public and not anyone directly involved in the horse racing industry? There is obviously demand for these old races, but the horse racing industry seems to never miss an opportunity to miss an opportunity.

Many tracks now are putting up racing videos on a Youtube site. This is a good start. Woodbine just began doing this a few months ago. It would be nice if Woodbine could take the time and add old stake races to their channel. I'd love to be able to see races that featured horses like Momigi, Tiny Tinker, and Northern Dancer (I wonder if anyone has a video of Northern Dancer's maiden win at Fort Erie in 1963).

Going forward R2Collective gives a very good assessment of the current situation and a some good ideas for the future regarding race replays and with respect to its relationship with the internet in general.


Bill Finley's newest article: A look at 2010, through a crystal ball
Horse racing satire at its finest.
Here is a taste:

July: NYRA is able to re-open after Jess Jackson lends the struggling racing organization $50 million in return for them renaming the Travers the Plastic Tracks Suck Stakes. New York racing resumes with opening day at Saratoga.

It is at least on par with my last April Fool's Day post.


Speaking of Stronach
Doesn't it rub most people the wrong way that Frank Stronach was able to have a deal cut where he still winds up with Santa Anita, Gulfstream Park and Golden Gate Fields?, despite the fact that Magna Entertainment shareholders got totally screwed as did unsecured creditors. He proved he can't run a race track, never mind many racetracks. His vision of horse racing was completely out of touch with reality and those who believed in him got the shaft.

And this just feels so not so right: Adena Springs buy Miss Isella for over a million bucks. I guess life goes on for Stronach, and he must have got out of the Magna Entertainment mess OK. Maybe Bernie Madoff should have used his legal team.


Support From Horseplayers Wanted

CHRB Meeting this Friday - Let your thoughts be known via email

This Friday there is a CHRB meeting in California. One of the items on the agenda is the following:

"Discussion and action by the Board regarding an increase in the take-out on conventional and exotic wagers on races conducted by quarter horse racing associations as permitted pursuant to Assembly Bill 246 (Price), Chapter 226, Statutes of 2009."

We believe that any takeout increase, for any wagering is not a good thing in, as takeout increases have been proven time and time again to lower handle, and lower interest on horse racing. Jeff Platt, HANA President will be at the meeting and they have allowed him to speak on some of the studies which show takeout increases hurt, don't help racing.

If you agree and want your voice heard we need your help. if you cut the following and place it in your emailer.

Send it to "BonS@chrb.ca.gov"

You will be registering your displeasure with takeout increases.

Please use this in the subject header: "Please say no to any takeout increases"


Shameless self promotion: Someone who read my last blog piece had a lot of good things to say about it on a Harness Racing Forum.


If you missed the jockey fight during a race at Philly Park, check out Thoroughbred Chat. The Partymanners Youtube debacle is also touched upon.

ADVERTISEMENT BELOW

Check out HORSEPLAYERSBET.COM

* Excellent player rewards added to your account weekly.
* User friendly betting interface making wagering easy.
* FREE LIVE VIDEOS.
* FREE RACE REPLAYS.
* Wagering Online & by Phone.
* Great customer service.
* 100% Parimutuel.
* No membership or wagering fees.
* No fees on debit or credit card deposits of $100 or more.

100% Parimutuel. Where even the smallest of bettors has a great opportunity to become a winning player, and maybe even a bigger player.

Tampa Bay Downs Drops Takeout On Some Bets

Tampa Bay deserves some applause. They have announced on their website that they have lowered takeouts on a few of their bets by 1%.

Take-Out Percentages

Win, Place, Show 17.5%
Daily Double 18%
Pick-3, Pick-4, Super High-5, Pick-6 19% Reduced from 20% last year!
Exactor 20.5 % Reduced from 21.5% last year!
Trifecta, Superfecta 25.9%
************************************
Compared to Woodbine
Win, Place, Show 16.95%
Daily Double 20.5%
Pick-3, 26.3%
Pick-4 25%
Pick-6 25%
Exactor 20.5%
Trifecta 27%
Superfecta 26.3%

And Canadian bettors need to realize that if they cash a Pick 3 or Pick 4 at Tampa Bay through an HPI outlet or at Woodbine or tracks that use HPI, you will receive at least 6% less than what the actual Tampa Bay payoff is.



Mary Forney recently did an interview with HANA (Horseplayers Association Of North America) board member and treasurer Theresia Muller during Breeders Cup Week. Here it is:

Theresia is a very devoted HANA member. I don't think she has missed a Wednesday night HANA board member conference call since HANA sprung onto the scene a little over a year ago. I've missed the odd conference call for the record.
Since HANA's inception, there have been no known takeout increases by any track in North America. We've seen a few minor decreases, and at least that is a step in the right direction.

To join HANA, click here, it is free with no obligations. The more bettors that sign up, the more clout HANA will have going forward.


Fort Erie Race Track is not the only track where efforts against closing are happening. Check out the Blue Ribbons Downs mess.

HBPA update on Fort Erie
Still no word one way or the other. This is starting to remind me of the movie Groundhog Day.

Meanwhile, the proposed car racing track is being fought by a group of Fort Erie residents who believe that noise pollution, wetland issues, traffic congestion, and lower property values will arise if the track is developed. My wife signed the petition to prevent the development, I did not.
Bringing in thousands of people to spend money in Fort Erie, creating jobs and hopefully some spill off of auto fans taking in a day at Fort Erie race track (assuming it doesn't close) outweighs the negatives. I also think it will increase property values because there will be full time workers that will drive up real estate prices. The noise won't be constant. Just a few bad days a year. Pollution? Already there. Trucks idling at the Peace Bridge will do that. And wetlands? Lots of wetlands in Canada. We are still a sparsely populated nation.

How many times does a small town get an opportunity like this?, if the opportunity is actually a real one (which I have my doubts about).

That being said, I have no interest in ever going to the car track. It just doesn't appeal to me at all.


Woodbine has introduced a channel on Youtube, WEG Replays

Good quality replays of all WEG races can be found there.


Australian Racing Steward coming to Toronto to review EPO testing procedures here


Julia Brimo getting support from fellow jockeys
"On November 28, jockeys across North America will unite to support Canadian rider Julia Brimo, who suffered head and back injuries in a spill at Keeneland Race Course on October 30.....On November 28, jockeys across the continent will wear the name “Julia” on their boots to show solidarity. Some will also donate one riding fee to a fund in her honour."

To donate to the Julia Brimo Fund send a check made out to Cindy Werner at 1116 Flat Rock Road, Louisville, KY, 40245.

Calder Purses Slashed: No Surprise Here

Calder slashes purses 15%; Horsemen Upset

I wrote this headline a year and a half ago: Calder Raises Takeout: What Imbeciles
There hasn't been very much movement upward when it comes to track takeout amongst North American tracks since I began blogging (I'm only partly responsible for this:)), and that is why I was so flabbergasted that Calder had the audacity to raise takeout rates last year:

The big news to specialty gamblers Monday was that Calder raised its takeout percentage on a few wagering options. The track will now take 27 percent out of Pick 3, 4 and 5 wagering (up 3 percentage points) and 21 percent from the Daily Double and Exacta bets (up 1 percentage point).

Yes, they took an already high takeout rate, and made it higher. What did they expect?
To make more money? HAHAHAHA Nope, they just found out how Economics 101 works. You don't raise the price for the sake of raising the price and expect to make more money. The doofuses need to read up on the basic law of supply and demand: When demand shrinks, they price (the takeout charged) needs to shrink.

The mix of track execs and horsemen is killing horse racing. The horsemen want want more money NOW and they attempt to use coercion to the point that racing execs, even if they had the foresight (which most don't) to grow the game (by lowering takeout), they can't. And in fact, they wind up making decisions like the one made by Calder, that help destroy the game.

The horsemen want more from a shrinking pie. I don't blame them wanting more, but they just don't seem to get the repercussions of their demands. For instance, they want larger signal fees to be charged by tracks so they can "theoretically" make more money from wagers. However, they don't seem to get that the only growing business in horse racing are the ADWs that offer rebates. By trying to squeeze out more, they wind up lowering the rebates offered, which in turn causes the price sensitive players to play less or bet with bookies offshore.


Good Reading: Crisis, Danger, And Opportunity
Well, the comments make for good reading. One jokester (probably a Woodbine Exec) posts under the name CGDean:

There is a simple fix for owners and breeders like myself.

It's a three pronged attack at raising revenues for the people that put on the show.

1. Open up all off track distribution (ADW's, internet, simulcast facilities, etc.) to anyone that wants it and pay them 5% for taking the bet.

2. Raise all takeout to a flat 30% on all bets.

3. Split the offtrack takeout 5% for bet taker, 10% for host track, 15% for horsemen.....on track takeout split 12.5% for track and 17.5% for horsemen.

If we can keep betting around the $12 billion mark, that means there will be close to $2 billion available for purses instead of the $600 million we currently have.

I know some people will say handle will decline but I beg to differ. We are already recovering from the horrendous economic downturn which will increase the already deflated handle. So basically, new money will easily replace any lost money if there is any.

Barry Irwin said "While the takeout is onerous, it has never stopped a real gambler". This reaffirms my thoughts that people will still bet on racing because that's just the way the game works. Even if we are wrong, and handle dips down to 9 million in a worst possible case scenario, under this plan, that still gives us between $1.4 and $1.5 million for purses which is about 2.5 times more than we get now.

Imagine a worst case scenario where our purses are doubled or tripled without slots. If we can get a slot subsidy on top of this, we can have purses in the same range of Hong Kong which will obviously increase betting astronomically and that will raise purses to levels of which we can only dream of.

*************************************
Is this a moron being serious, or is it someone trying to show how farcical owner/breeders have become with their collective industry mindset and their demands? I can't tell anymore.

I replied to another comment there:

VEC said: "I do not believe our take out, also 22 to 24%, deters the average bettor, and certainly not a newcomer to racing. Not many at the track, or down at the local OTB complain about it."
**********************************
Again, this misconception keeps on showing up all over the place.

True,most horseplayers don't care about takeout. Just like slot players don't care about the house edge. They never complain about it.

However, Vegas started out with a very high edge on slots, but through trial and error they realized that the optimum edge is 8-10%.

This means that if they doubled the edge, they wouldn't get even half the total money bet.

So why is it? Because customers get blown out to quickly. They may not even realize why they don't feel like going so much, but they don't.

And when they don't go so much, they are less likely to bring friends, family, neighbors and coworkers with them the odd time to expose them to the slots.

Same is true in horse racing.



HORSEPLAYERS ASSOCIATION OF NORTH AMERICA APPOINTS JOHN PRICCI TO THE ADVISORY BOARD
Pricci is one of the few horse racing journalists who completely understands that horseplayers are the driving force of horse racing, and has no problem writing about it.


Adena Springs Finally Figured Out That It Is More Lucrative To Breed Ontario Sired Horses Rather Than Florida Bred Ones

'The stallions that will be moving from Florida to Gardiner (in Ontario), joining other Adena stallions Sligo Bay and Silent Name, are 1996 Breeders’ Cup Classic (gr. I) winner Alphabet Soup (Cozzene—Illiterate, by Arts and Letters), multiple grade I winner Milwaukee Brew (Wild Again—Ask Anita, by Wolf Power), and graded winner Olmodavor (A.P. Indy—Corrazona, by El Gran Senor). New stallion Giant Gizmo(Giant's Causeway—Golden Antigua, by Hansel) also will stand in Canada.'


SHHH Don't tell anyone, but despite the bad economy gambling continues to be on the rise in Canada.
Well, not at the racetracks though. Maybe one day they'll wake up and understand that it is the onerous takeouts that prevent horse racing from growing. I have a feeling it won't be under Willmot's watch.


For those who think that takeout is the same as it was 40 years ago check out this from the Daily Racing Archives:

LINCOLN DOWNS R I May 13, 1964
Under a new appropriations law that went into effect Monday night, the total parimutuel takeout on racing in Rhode Island is now 16 per cent. The additional 1 per cent is split evenly between the state and the track. The state receives 8 1/2 per cent and the track 7 1/2%. The new tax went into effect with the races at Lincoln Downs Monday night. In Massachusetts and New Hampshire the takeout is 14 per cent. Vermont is the highest in the nation with an 18 per cent tax followed by Maine with a 17 nick.
******************************************
Stands were full back then. Bettors had fewer betting options, win, place and show, a couple of exactors a day and a daily double. Many left the track with money in their pockets, enough to entice them to go back as soon as possible.

One of the better arguments to today is how does a track rationalize charging more for triactors and other exotics? It doesn't cost them more to print the ticket or to take the bet at a terminal or online. But the reality is that the exotics with the highest takeouts really kill bankrolls and ultimately discourage bettors from playing as often.

I don't have the numbers, but I'm pretty sure takeout at the ORC track (Woodbine, Fort Erie, and Greenwood) were something in the neighbourhood of 14-16% tops. And the government was taking around 7.5% back then. Nowadays, Woodbine's average takeout is closer to 21%-22% and the government only gets 1.3% on each wager.


Did Chantal Sutherland recently have botox lip injections? It sure looked like yesterday on The Score.


HORSPLAYERSBET.COM HAS A NEW PROMOTION:
20% Match On Your Initial Deposit!

Open an account and receive a 20 % match on your initial deposit! Restricted to new customers only. Customer must play at least their initial deposit amount within 14 days of opening the account. Maximum deposit eligible for promotion is $1000. This promotion is not to be combined with our standards rewards program which will begin after the initial deposit amount is wagered. Other restriction may apply.