Monday, February 1, 2010

Slots, a Tale of Two States

The New York slots debacle appears to be over, as the governor has made his choice. You can see the dollar signs in everyone's prose, eyes, whatever it may be. Unfortunately, virtually all the commentary I have read is exactly what we heard here in Ontario, circa 1995, about slots at racetracks.

Namely:

If we upgrade our facilities

If we increase our purses and get better horses

.... we will thrive.

We all have problems with that because, well, been-there-done-that and we have the t-shirt. In Ontario we learned the hard way that a new coat of paint did very little to increase attendance or wagering, and the promises of site improvements being a savior were completely off the mark. In addition the better horses promise was equally specious. One would think people in racing would have read the University of Louisville study on wagering which stated when increase purses, handle goes up by only a negligible amount. What many knew at the time, but it was not trumpeted, was that adding slots onsite actually decreases handle - killing your on track business.

Slots helped some people get rich, but they did not grow racing.

If New York is anything like Ontario they will have top-of-the-line dining rooms, with no one there to use them in a dozen years.

On the flipside, the New York Times reported on the New Jersey racing situation - “the status quo is not sustainable”. It certainly is not, in the state beside slots rich New York.

In Jersey they have no lifeline, or a hope of one, but they try their butts off. Low takeout bets, new bets, some good promotions - all grown in Jersey. They have to fight for customers and fight they do. It is truly sad when the folks who try hard perish, while the folks who sit on their duffs and cash slots checks thrive. There is just something so wrong with that.

New York could do what New Jersey is doing without slots, with them. They could use some of the slots cash to lower takeout (something that actually does increase handle), and throw long-suffering bettors a life preserver to encourage them to play the game.

It seems they have chosen the old way; the Pennsylvania and Ontario way. Let's just hope 31% takeouts don't follow, like many Penn tracks currently sport.

Maybe New York should send some cash to Jersey. I have a feeling they would do something with it to grow the sport, something completely wacky - by investing more in their customers than in their dining rooms.

2 comments:

Pacingguy said...

Let's not kid yourself. The states approve slots because it is a way to raise funds off their perceived 'degenerate' gamblers. They don't care where they get their money from. The tracks are happy to oblige because they get rich. Horsemen are happy because they get rich. Bottom line is no one really cares about the gambler; it is all about getting rich at someone else's expense.

The_Knight_Sky said...

Well put Pacingguy...

but who's responsibility is it to promote the future of horse racing?

Does it not fall back into the racetrack's lap to have devoted (competent and winning) bettors of their live racing product?

And racetrack that is blessed with slots revenue should automatically be thinking reduction in the takeout rates. When the novelty of slots wears off locally, they'll be asking:

"where did we go wrong?