Thursday, July 30, 2015

The Ol Phantom Purse Hike. Kids Do Get Into Handicapping.

There's mucho consternation about the new-found $750,000 for a Haskell Stakes purse bump.
  • With the William Hill Haskell just four days away, Monmouth Park announced a $750,000 purse increase for their signature race.
Hey, for that extra $750,000 I will enter my horse.

Hold it, entries are closed?

As Jessica pointed out, this seems to have been the case all along:
I realize getting a Triple Crown champ to a track is a sausage making exercise, but this, in my view (and reading SM I am not alone), is not in the spirit of the sport.

Brian DiDonato was interviewed in this month's Horseplayer Monthly (read it here, it's free). Brian got into handicapping about 10 years ago, and is now the Racing Editor of the TDN. One answer, about tools of the trade, shows just how cool handicapping the horses is.

"Breeding just isn't as well understood by the wagering public, and good pedigree information is somewhat less accessible and also moredifficult to decipher, so it's less factored into the market. Extended pedigree and sibling reports are key for me, as Itend to give more weight to the dam's influence. I also put a lot of emphasis on 2-year-old sales breezes."

There are many ways to skin a cat. Very few betting games, if any, have data points that can be exploited as there are in horse racing. If the sport concentrates on making this a better betting game, I have always felt the sky is the limit.

Brian is one of those newer players (I think he's under 30), who enjoys the game and has a pretty sharp eye. In fact, I probably owe him a beer. A few years ago I was handicapping a Derby card. I loved a horse in leg one of the first pick four and constructed my tickets. Derby morning I read Brian's thoughts - I just stumbled upon them - and thought they were really sharp. Lo and behold, in the sixth race - the third leg - he liked a horse in an inscrutable turf sprint that I was not going to use. At the last second I threw the horse in, he won, and I hit the pick 4. My $40 winner in the first leg, keyed, might've paid off (I used an all on one ticket) but would not have been anywhere near as lucrative.

Serendipitous, for sure, and since that time I have read Brian's thoughts and shared mine. He's a good follow on the twitter right here.

Give the magazine a read, and please share it via SM or email. The boys and girls spend time putting it together and the content, for free, is worth looking at, especially considering the price!

Have a nice day everyone.

Wednesday, July 29, 2015

Dale Carnegie

Churchill Downs Inc. made some news yesterday, in a couple of quarters.

  • All New York State Off-Track Betting Corporations announced today that they have severed their relationship with Churchill Downs Inc. (CDI), the owner of Churchill Downs and the Kentucky Derby, citing rate increases by CDI which result in losses for OTBs on every CDI race track. “The actions of CDI constitute nothing less than extortion,” said Western OTB President Michael Kane.   
  • Churchill Downs Inc. which operates the eponymous track which hosts the famous Kentucky Derby, will reportedly continue to remove more of the vestiges of horse racing from its South-Florida Calder Race Course.The latest plans call for the demolition of the track’s grandstand.
It looks like the next meet will go on, but you will have to bet from tents. Tents. To ensure you didn't read that wrong, or I typed it wrong, that's tents.

When we look at last year's issues with Fairgrounds, the takeout hike at Churchill Downs, this year's handle and racing issues with Arlington, it seems the whole win-friends-and-influence-people thing for them in horse racing has seen better days. 

Tuesday, July 28, 2015

Watchmaker & Industry Suicide

Mike Watchmaker - unbeknownst to him I imagine - started a brouhaha of a semi-regular variety yesterday with this tweet.

This spawned the usual responses; those with circular logic, memes that we all need to get along and knit peace quilts, and that those who agree failed sharing in kindergarten. But, brass tacks n' all, Mike is about right.

As a dude who had a 15 horse or so stable, with a few yearlings and racehorses, you learn this pretty quickly. Upon dispersing stock, the horses were all purchased and raced, the feed men still had horses to feed, the vets had horses to treat, my trainer filled the lost stalls with new horses. Trainers and grooms for those horses got paid. Our leaving did not upset the ecosystem. That's what happens when you sell assets. If you have a lawn cutting business, there is someone there to buy the equipment, or buy your book, and it's the same in racing.

If I was betting $10M a year, at say Kentucky Downs, I am contributing about $500,000 to purses for that track (along with another $500k to keep the lights on). Kentucky Downs races, what, about 5 days a year with $500,000 in purses per day? If I leave, one full race day gets cancelled, because I am not replaced. I have no book to sell, no asset to sell. Purses and profits go down, by perhaps as much as 20%, and much more if the place did not have alternative gaming. In fact, in that case, the whole meet might get scrapped if I left.

Unfortunately, these arguments get mixed up. If you say the above, it comes out that owners 'don't matter.' Of course we do. Owners are playing a losing game; they are not buying horses as an investment, because the ROI is terrible. They are playing the game at many levels for ego, the thrill, the joy, the entertainment of owning horses. This is why, I and some others, were annoyed with Churchill a couple of years ago at the Derby. These owners for that day are partaking in their Super Bowl. It's the reason they buy horses. That they were shuffled around, and (in their view) mistreated, they were saying, "I lose thousands and thousands of dollars in this sport and you're nickel and diming me?" It wasn't about rich guys wanting perks. It was about the passion of owning, which is not based on dollars and cents, being attacked.

Similarly, it is why I and others get so upset with takeout hikes or source market fees or ADW taxes to "raise a purse", promulgated by so many short-sighted alphabets and executives. Even if lowering payouts to horseplayers worked to raise purses (if it did, Italy would be the best place to race a horse on earth when they raised the trifecta juice to 41%; instead of imploding) that $5,000 extra for a MSW is meaningless. So, an owner loses 41% instead of 42%, with that bump. Whoop-de-doo. Conversely, what that does to the customer - like the guy or gal keeping Kentucky Downs in business above - is get him or her to leave, and he or she is never replaced.

Horse racing has a lot of work to do to increase ownership. It needs to be better run, to make the ownership experience - owners will always lose money in the aggregate, anything else is delusional - better and more worthwhile and fun. But it can never be made better at the expense of the betting customer. That my friends is industry suicide.

Monday, July 27, 2015

Lipstick on a Pig Ignores the Real Betting & Customer Issue

Darryl Kaplan wrote a piece at SC about the lack of organization in televising betting products at  OTB's. In this case, he speaks of the fact that at Woodbine, the televisions are all on higher bet simulcast products, instead of a Canadian product, and this hurts Canadian racing. This is not an uncommon thought; California Thoroughbreds often wring their hands about it, as does NYRA. Everyone wants you choosing their product.

But it's short sighted.

You could have every TV on the three tracks you want to push, it would make no difference in the long-run. No difference at all. The system, especially in Canada, is setup for failure.

Back in the 1990's. Ernie Dahlman was playing the races from New York, and scratching away a modest living. Higher and higher takeouts made the game harder and harder to beat, so he sought out and received a takeout break on his betting (in Vegas). Others followed and some sort of community emerged where you could beat the races, not only a race. That lower takeout environment was built on something that made perfect sense.

In Canada, this is not the case. Woodbine has started selling their signal to other ADW's in different countries, but as a condition of it, they have asked these ADW's to kick out all Canadian horseplayers. Horseplayers in the country, unless they are particularly savvy, have no choice. They can bet through the massive takeouts at HPI through Woodbine (sometimes being charged even higher takeouts from US host tracks), can quit completely, or bet offshore, in pirate pools. The environment to foster them as long term horseplayers - the one they were playing into for years - to keep feeding purses through betting each day, has been eliminated. For new players who might want to become long term players, there is no avenue for them to pursue this craft, like in poker or other games.

The great art of handicapping, the great goal of becoming a regular, everyday horseplayer, to possibly earn a living at, is now a pipe dream for almost all the country's 36 million citizens. 

Horse racing in Canada (with Woodbine's policies in particular) has created this. It's a grave error and one they should correct, but they won't. It's the way many organizations think in the sport, and with these organizations getting casinos, or slot parlors to subsidize purses, there is little hope things will change. In a generation they will wonder what happened. They'll just need to look into the mirror.

Friday, July 24, 2015

Culture, Part 19

There's a fascinating story on the Racing Biz, about a positive test for a horse in a grade I race, that no one seemed to know ever happened (don't worry, you didn't miss it. It was not reported).
  • Princess of Sylmar, the beaten 1-5 post time favorite in the July 12, 2014 running of the Grade 1 Delaware Handicap, came back with a post-race overage of the corticosteroid betamethasone, which under Delaware and Association of Racing Commissioners International model rules is permitted to a threshold of 10 picograms per milliliter of plasma.
  • But after a year of legal wrangling, the state will drop the inquiry and release the purse funds, Delaware Thoroughbred Racing Commission (DTRC) executive director John Wayne said July 23, “based on the advice of the deputy attorney general."
No one disputes the positive happened - a split sample confirmed it - but legal wrangling allowed it to be expunged. The owner gets the $150,000 for coming second, the horse owners and connections who finished 3rd through sixth are out of luck.

I am not going to argue about the merits of the case, either way. I understand the US is litigious and these things happen. But, it could not help but remind me of something I wrote last month, regarding PGA Tour Pro Scott Stallings.
  • Just this week this culture was exemplified with PGA Tour pro, Scott Stallings. Stallings was prescribed something by a doctor that he was told was not banned. He was tested by the Tour while taking it, and he did not trigger a positive. All’s well right? No harm no foul? No, that’s not the way it works with the golf culture. Stallings found out months later the drug he was taking was banned, so he contacted the PGA Tour and called the positiveon himself. He was suspended for 90 days. Some might say he should’ve kept quiet, appealed, claimed how unfair this all is; how he’s a victim who did nothing wrong. But, that’s not in the sports’ culture.
Sure the PGA drug rules are unclear, sure a doctor told him that it was legal, sure there was no intent, sure it was an honest mistake, sure they didn't even catch him with a test when he was tested. But he's suspended.

We've seen this same thing with millions upon millions on the line in golf. The "unclear" rules at the PGA Championship in 2010 about waste areas certainly cost Dustin Johnson millions. But there was no griping. It is what it is.

I'm not a good person to ask about "overages". I think a lot of the overage penalites are at times very penal, and somewhat silly. I am not one to ask about fairness because state by state there are not uniform rules on this sort of thing. However, it does strike me as odd that in one sport the culture is set that the rules matter. In another, they're something to hire a lawyer for.

Wednesday, July 22, 2015

Without Emotional Star Attachment, Horse Racing Needs to Stay Event Driven

There was an article on the Golf Channel website yesterday.

"In golf, like those other individual sports, a player must give you a reason to care. Most athletes, even some of the most fantastic ones, just don't have that extra push, they just don’t quite enthrall us like that. We admire them, applaud them, even root for them. But they never quite grab us emotionally. We don’t quite love them."

Jordan Spieth, the 21 year old golfer from Texas, has begun to do just that for the game of golf. Ratings for the Masters, US Open and British Open were all up.  Ratings for smaller tournaments he is partaking in, are also sky high. People want to watch him play, follow his young career and are emotionally attached to him. 

The above is not ground-breaking, or not much more than obvious, of course. It's like that in any individual sport and it's common sense.

I received an email recently from a student taking a horse racing program overseas. She asked about horse racing marketing the "stars"; how it could be done, and if it will move the needle, say like a Jordan Speith does. My answer to that was, it's difficult.

Horses that the general public have an emotional attachment with don't come around very often. Zenyatta, a poster-horse for such attachment, didn't hit her groove with the general public until start 14 or 15, in year three of her career. That's when ESPN gamebreaks started showing the streak. At start 19, her zenith in terms of popularity, she was on 60 Minutes, watched by 14 million. Then one start later, her career was over.

Zenyatta was lightning in a bottle. She was once in a generation, in terms of popularity. She moved the needle, but it was extremely difficult.

To capture emotion, horses need to i) have something about them that resonates, like a Jordan Spieth, ii) need to win at a high level iii) race frequently, and iv) race for a long time.

That's not modern Thoroughbred horse racing. It's round peg, square hole.

This is why, I believe, horse racing is always, and should always be, event driven.

The Triple Crown series works because of the Triple Crown series, not who races in it. If the Kentucky Derby field is filled with future 10 claimers, 150,000 will show up to watch, 15 million will watch on TV. The event trumps the stars.

The Breeders Cup is not dissimilar. Although it's the poorer cousin of the Triple Crown series, the event itself is the brand, not who races in the Juvenile Turf.

It's nice to hope and wish for horse racing's stars to capture the imagination of the public. In some cases it happens - Zenyatta did it, American Pharoah's next couple of races will be well-watched - but not nearly enough to move the needle for the sport.

Horse racing is a gambling game, or "gambletainment" as my friend Eric calls it. It, to me, is much easier to place hopes, marketing money, and a push to increase revenues from that end of the sport. It's head-scratching how the sport seems to sabotage this path-of-least-resistance avenue at almost every call. However, from the fan side, it's much easier to focus on marketing events, what they mean, and how they resonate, rather than a horse. Events can happen every year, good horses who possesses the characteristics to move a needle don't come around very often.

Have a nice Wednesday everyone.