Monday, January 31, 2011

Exchange Wagering Signed into Law In Jersey

Nj.com reports the law that allows exchange wagering has been passed and signed into law.

What's next? I would assume a fight about what to charge. We'll see at that time what the powers in Jersey hope to accomplish. If the rake is changed it doesn't take a rocket scientist to know it will fail , but if they get a good deal from Betfair for a share of the gross profits instead (and a nice hunk of remarketing thrown in), it has a chance to help change the Jersey landscape, in a state that badly needs an influx of new customers, or eyeballs on their product.

Animal Alert!

Kangaroo's forced the cancellation of races in Australia last week. h/t for the video to Standardbred Canada.



I am still partial to the bears at Sudbury Downs, though.


I so wish the video of the deer at Mountaineer was around somewhere. That doe kept up with the horses for at least a half a furlong.

Sunday, January 30, 2011

NASCAR or a Horse Race?

The yearly Prix D'Amerique in France is always an absolute joy to watch. The stands are packed and the racing - which looks more like a stacked-turn NASCAR race than a horse race - is top-notch.

Deep fields with 15 or more runners has been tried at times here, but only as a novelty. Clearly the way we do things, and our fan base which does not take to change very well, is not conducive to this type of racing. However, there is no denying that it is interesting, and does offer up some amazing betting opportunities to punters. Could you imagine a quadrafecta at 20 cents in this field? You might be able (if we had pool size of course) to make a life changing score.


I watched a little bit of the betting on Betfair, and despite not being offered in France there was a little bit of action. This race, and races like this can be a huge promotional vehicle for exchange wagering, especially in-running. Once again, critical mass is needed, but Rome was not built in a day.

Over here 9 horse fields at a mile are catch-me-if-you-can affairs most times as this is a speed game. There is no denying that for sure, but there is a compelling argument about changing things up from time to time. I can't watch a race like today's below and think otherwise. Very, very cool.

Saturday, January 29, 2011

St. Elmo & A Rob Lowe Lid

There were two big stories in racing this evening. A horse trying to go 23 for 23 in the Complex at the snowy Meadowlands, and the O'Brien Awards, broadcast for the very first time by Woodbine.

St. Elmo Hero is absolutely, positively, for real. On a cold night he was stung big-time to the half by one of the four horse entry against him in a brutal 53.3. Tetrick shut him down to get a little rest for about an eighth of a mile, but along came another challenger. He looked like he could easily be beaten, but not a chance. He motored away to win in a very impressive 149.1. When the video is up we'll link it.

Tonight's O'Brien Awards, streamed for the first time was fairly entertaining.

Most of the night went to plan, however I was struck by a couple things.

Riina Rekila lost horseman of the year and I was surprised. Riina is a fantastic horsewoman and exactly what this sport needs.

Western Silk beat Put on a Show?! Are you kidding me? The greatest mare since Rainbow Blue doesn't win an O'Brien? Wow!

Comments from the peanut gallery this year asked the O'Briens to add a Vet of the Year category next year, because the human awards are what they are. I think the peanut gallery might be onto something.

On the flip-side, Waples winning driver of the year was a no-brainer. I must admit it was the only time I have seen a driver of the year interviewed who thanked Viagra. He should have thanked his barber because that was the best Rob Lowe lid I have seen since I saw Oxford Blues on late night TV. Go Waples!

Rock n' Roll Heaven did not get bit by a Western Silk bug. He won, which was an awesome choice. The best horses need to be recognized.

As for Horse of the Year Dreamfair Eternal won in a face-off with San Pail. My old pal Greg - sure that San Pail was going to win because the awards were homer awards - was not on point with that one.

It was a fairly interesting evening and it was fun to watch it streamed. I hope they do it again next time.

Friday, January 28, 2011

No Whipping, DRF Solid, Is this Horse a True 999-1 Shot?

If you use anecdotes to bet, to buy a horse or to do pretty much anything instead of using hard facts, you tend to miss out.

As we have spoken about before here with betting, in the 1840's Austrian physicist Ignaz Semmelweis did a study he thought would change the way that babies were delivered. The infant mortality rate was very high at a hospital he studied but the good doctor found out that if nurses and doctors simply washed their hands, this rate could be severely reduced. He brought his findings to the hospitals. They asked “Why does your data show this?” Semmelweis could not say why, he just told them that it did. The hospitals would not succumb to his wishes and change their washing policy - in fact they fiercely resisted. If he could not tell them why his data showed this, they wanted nothing to do with it, because this was the way things were done for centuries.

At the time no one knew it, but this was one of the very first studies into germs and the harm that they can do. If they had implemented his policies, lives could have been saved. That is the lead story in the book "Supercrunchers" about stats and numbers telling the story.

This week there is another study, this one on whipping thoroughbred racehorses. It is peer-reviewed and it concluded that whipping near the end of a race does nothing for the speed and final time of the horse. Predictably, racing insiders who have done it their way for a hundred years call the study garbage.

This is the same thing that happened up here in the Standardbred industry. The whip changes a year or so ago were assailed and we were told "final times would be slower" because drivers could not "lay into the horse".

What happened was a lesson that we should never look to the anecdotal, only at the evidence. Times have not gotten slower, they have arguably gotten faster. Without the use of the whip the NA Cup went in 148, Big Jim set a World Record 149 flat, and there have been numerous track and Canadian records, all without being able to "lay into them". As for regular races, please show me how slow it is. Cheap horses which again apparently need to be "laid into" to go fast, still are. A $4500 claimer at Flammy went in 54.4 recently, just like the old times, if not faster.

The DRF
told it like it is in a recent article. Race day cuts are not doing the job, killing off customers are not doing the job, slots and other subsidies as a band-aid are not doing the job. And most definitely, takeout hikes (a Supercrunchers type-topic) don't add to purses in the short or long run because they kill handles. More customers and more money from them do the job and we don't have that right now, nor do we have policies to get there.

HANA met with Del Mar and Santa Anita heads this week. By the sounds of it in the article, Santa Anita and Del Mar management want to play ball. The horsemen organization doesn't. Read the DRF article above and we can figure out the disconnect nicely.

Yesterday at Warwick in the UK a horse in a six horse field traded about $US450 in running at Betfair. The price - the highest it can go, 999-1. What is absolutely shocking about this, is this horse was the pre-race favorite. This almost never happens. If a 40-1 off price struggles like that 999-1 is totally legit, but if a chalk does it, it rarely reaches that price with so long to go in the race. I admit the horse did look like he blew a tendon or something so I can see it. But something tells me that fair odds on a chalk like this is not an ROI positive lay. Some people got rich, and a lot of people got broke.

Here is the video. The post race commentary is solid regarding the in-running betting. Follie a Dur (sp?) who is third in the early running is the horse to watch. What a shocker.

Thursday, January 27, 2011

Hulu Meet Racing

The Wall Street Journal has a story up on Hulu - the web streaming television service - today which details their possible changing business model. The change in tactics has to do with cannibalization, and ad revenue.

"...its owners—industry powerhouses NBC Universal, News Corp. and Walt Disney Co. are increasingly at odds over Hulu's business model. Worried that free Web versions of their biggest TV shows are eating into their traditional business, the owners disagree among themselves, and with Hulu management, on how much of their content should be free."

I have never really understood the model in the first place, and although it was an ad revenue driver, this is not overly surprising to a lot of people.

In the old days CEO's said "get me online for some of that internet stuff" and built websites. Later on they worried about selling something profitably. Now it seems we are at "get me some of that online video stuff everyone is watching" but again the same rules apply.

The problem with television streaming video or their produced shows, lies in the fact that other than the medium (ie watching at home on your TV or on your computer) there is very little difference in product. Sure you can watch a show at a coffee shop, but you can DVR one now and watch it at home on a $4000 home theatre system. For those who don't want to pay for cable or satellite TV it's there, but chances are these folks would have a TV if they needed to. It reshuffles the deck chairs, it does not build a bigger boat.

Racing has the same issues and has for some time. Internet wagering, long held as a beacon of hope for the industry, has not delivered what it has promised. Sure "we gotta get us some of that internet wagering" and have got some. Yes it is growing. But it is simply, like online TV show streaming, catering to the exact same audience because there is nothing ostensibly different about it.

The marginal cost of taking a $2 bet at a portal could be pennies, yet they have not changed their pricing. I could bet a superfecta in 1992 by punching it into a machine and in 2011 I can bet the exact same superfecta on a machine. It's the same game, the same bet the same everything on a different medium, and not much else.

In contrast to Hulu or network sites that stream their shows and racing, successful internet businesses add some hard value.

In 1976 I would buy 1000 shares of a stock at $1 and pay $200 commission. To sell it I would have to wait until it hit about a buck and a half. It did not matter too much if I had to call a broker on the phone. It had no value.

In 2011 I could buy the same stock, pay $15 in commission and fire it out on a spike to $1.09 and make a couple of dollars. Sure the fact I can do it with a mouse adds convenience and is something, but it is not the reason mom and pops and others all around North America are trading the markets daily. Value is.

In racing Betfair is the prime example.

They did two things that used the Internet as it should be used. First, they took a solitary game like horse betting, and made it social with a different platform. You are not standing in a line, or betting an exacta with a different tool. You are playing a brand new take on an old game.

And clearly that was not enough. Second, I, like a lot of you, will only play something neat or new for so long if I am getting my wallet kicked. We need price value like Etrade. At betfair they delivered it with low takeout. This is particularly relevant as the US looks at exchanges and some want to control them. Charge 14% takeout and you kill it before it starts, because you kill what drives it - its differentiation.

The above is why Etrade and Betfair do not and has not cannibalized stock trading and horse betting, it grows it.

We often hear the Internet has not delivered for horse racing what it had promised. In actuality, we in racing have not delivered what the internet asks.

Hulu is going through the same thing right now. It will be interesting to see which way they go for their new business model, but I will bet you a donut the change will be systemic and not cosmetic. We in racing must start to do the same thing. It's not about much we can squeeze out of the same lemons, it's about how many lemons are in the bush.

Wednesday, January 26, 2011

Lose Your Shirt Owning Horses? But We Might Get Relief

I thought the biggest news of the day was that Georgia might be serving beer on Sunday's, but there is more. John Craig challenged the farming losses on our (Canadian) tax returns. At most we can claim $8750, which is not enough. And he won.

Much to the delight of the standardbred industry, the Federal Court did not agree. In the ruling (click here to view the PDF), Justice John A. Evans stated that he was "not persuaded that the Judge made any error of law in applying the somewhat more flexible and generous test in Gunn for determining the circumstances in which section 31 permits farming and non-farming income to be combined so that farming is a taxpayer’s chief source of income."

Cool, I can now lose even more money and get some of it back. And so can you.

In response to the increase in horse ownership this affords, Woodbine and major Breeders are going to lower takeout rates to help spur wagering and get horse racing on the front pages again. Nah, just kidding.

There is a welcome new race at Mohawk this year. Woodbine and owner Richard Young have combined to offer a $100,000 invite for mares. As most of you know, Young and Tom Hill, owners of Put on a Show and Western Silk respectively have been sparring in the media about who has the better horse. Instead of a match race, it looks like they will meet in this full-field invitation. The twist: Donations will be made to Young's daughters charity, Spring of Hope that does work in Africa.

The $100,000 race for Pacing Mares will have WEG Standardbred Director of Racing Scott McKelvie extend invitations to horses for the event with no nomination or starting fees. In lieu of those traditional payments, the owners in the race will be asked if each would be willing to donate a minimum of $1,000 toward the cause.


Pretty good news from North of the border today.

Tuesday, January 25, 2011

The Industry Matures

Our industry is maturing in fascinating ways, right before our eyes. Coming to terms with things that have held us back or made us protect the status-quo for so long is a sure sign. I don't know if it is too late, but debate on myriad subjects by a more and more well-informed industry, is welcomed.

One example that really sticks out is pricing. In 2003 I watched an industry conference put on by the TRA. It involved people like Maury Wolff, Dave Cuscuna (both bettors) and a couple of industry execs. The topic was bettor behavior and the rebate business. Cuscuna and Wolff argued with hard numbers about how they bet, their volume and bet size at different price points, and how the system is set-up for ADW's to attack these price sensitive customers by offering something racing has never offered them - lower juice.

The debate at that time was in its infancy on the big stage (although for years before that, bettors like Ernie Dahlman in New York was pushing people to look at it, because they were losing bettors like him). The chatter at that conference and a few others that followed was all about getting a bigger slice of the bettors business, rather than opening up rational discussion on why this business was working for bettors (i.e. the old way was failing them as customers).

Think of the machinations of the music industry and its response to Napster, one of the top blunders in business this century. And as Seth Godin wrote several years ago:

The new thing is never as good as the old thing, at least right now.
Soon, the new thing will be better than the old thing will be. But if you wait until then, it’s going to be too late. Feel free to wax nostalgic about the old thing, but don’t fool yourself into believing it’s going to be here forever. It won’t. Every single industry changes and, eventually, fades. Just because you made money doing something a certain way yesterday, there’s no reason to believe you’ll succeed at it tomorrow.


Along came tomorrow with betfair. For price-sensitive bettors this problem of too high pricing was brought even more into the mix. After years of the customer base being preached at as "degenerate gamblers who think takeout is what they do when they order Chinese food", the industry began, slowly, to say: "whoa, maybe they are onto something here".

Some early people in racing like Chris McErlean, who ran wagering at the Meadowlands, knew what was happening, and several others did as well. In 2004 racing commissioned the "Cummings Report" written by a gambling expert to explain what was happening with the game. He spelled it out on page two: 'The only businesses that can average cost price are monopolies, and racings ended years ago'.

In the years that followed there was not real honest discussion on things like rebates, even with white papers like the Cummings Report telling racing they are here and upping volume by catering to price sensitive bettors. The only thing that racing wanted is what it always seems to want: How can we get more money from these people? They failed to notice their customers were not the problem, they were a harbinger to finding a needed solution. After the UIGEA passed and all this money that was supposedly lost to offshores never came back, racing started to learn what their customers were telling them.

Things have now changed.

If we read the Paulick Report there was a piece yesterday on rebating, appearing to be disguised as a shot at Jeff Platt, a friend of mine. In 2004 the comments on this piece would have been absolutely brutal. But now, in 2011, the comments ran completely the opposite.

Not only did the web poll on the site accompanying the piece "Do you think rebates are bad or good for racing?" go against old time racing (90% good, and 9% bad), so did the narrative. Bettor after bettor and industry type after industry type spoke of racings mismanagement making this an issue, not the human target of the piece (in fact it was equally fascinating to see the comments about Jeff: When you are a good person, one thing you have are friends willing to defend you when they feel you are wronged. There is some "Jimmy Stewart" going on with the comments).

If you read twitter as well, they figured out what was going on in a milli-second.

It was completely interesting to watch as a case-study on how far we have come. Hit pieces about an issue that five years ago could be demagogued as effectively as a health care issue or a political attack ad fell completely flat.

Almost everyone who follows the business knows two things about rebates:

1) They provide lower takeout
2) They are here because there are horseplayers concerned about takeout and it keeps them in the game, betting bigger and being happier customers

They also know that rebates can be eliminated in one of two ways:

1) By cutting off all rebate shops or
2) Lowering takeout for everyone

Racing does not want to do the first one, because handle would fall faster than an oversized pair of swim trunks. They won't do the second because? Well that's the million dollar question.

Regardless, the industry and industry watchers via various forms of social media are aware, and anything but dumb. If you are going to put forth a 1995 argument in 2011, the responses are going to be much, much different. We are slowly maturing. The only question left is: Is it too late?

Note: Tom Lamarra via twitter (@JerseyTom) offers out his article from 2004 as background for those interested. Quote: "NYRA chairman Barry Schwartz said. "I don't think rebate shops are the problem. The problem is our structure--what we're charging for signals, and the takeout. If takeout rates were more reasonable, places wouldn't need rebates."
"

Saturday, January 22, 2011

I Always Respect the Blogosphere

"You never know who you could be reading". That is the way I handle reading blogs of all stripes, twitter, chat boards and Facebook comments, and that is the way I handle the new social media as a rule.

There are blogs out there for example, that are filled with awesome information, from people who are passionate about things. You do not have a long-running blog if you are not passionate about some topics, and there is a very good chance you will get info that is not only worthwhile, but educating.

As I mentioned, just yesterday tech bloggers (who are very sharp at times) absolutely killed analysts who get $100k+ salaries on their Apple quarterly predictions. These folks, in their spare time, almost hit IPAD sales, and revenue figures to the number, while the "pros" faltered. I don't know some of these people's names and I could not care less. What they say matters.

We have all heard dozens of stories like that. Anonymous people with strong opinion.

Sometimes, too, you never know who you are dealing with.

I remember reading a chat board awhile back where a person posted about Zenyatta. He said something nice about her place in history and that his performance figs show her to be as good or better than "x". He made a strong case and you knew reading it, he was a player. Regardless, he was immediately flamed and asked "if he sleeps with a pink hat on". I know the person who wrote the opinion. I would estimate he has pulled out seven figures betting racing the last four years. I can not confirm or deny if he sleeps with a pink hat on, but I do know he is worth listening to.

I have been burned trying to make a judgment on someone based on obfuscatory or tangential criteria. I now only read the message, and make judgment from that. Anonymity, or not knowing the persons name does not bother me in the least, when they are sharing an opinion. It's the opinion that matters.

I notice this morning, Cangamble, wrote about the Steve Crist article at the DRF. He makes some valid points and he is no dummy. Just because Steve Crist is Steve Crist it does not mean someone can not make valid points about something he writes and share it, positively or negatively. This is not China where someone with an opinion has his IP blocked. The opinion Cangamble writes this morning will stand or fail on its merits, and it has nothing to do with the person behind the keyboard. Nor should it have anything to do with the target of the opinion.

There are many people I read who I know are "experts" and that is cool, because I like reading people who tend to know their stuff. But there are many people I also read who I don't have the foggiest what their name is, or even what country they are from. They know their stuff too, if you simply take a minute to read it.

California Screaming, Atlantic City & Other Stuff

I listened to the CHRB meeting this week. I promised myself that no matter what I would not say anything bad about it. I'll let the Thoroughbred Times talk about it here.

"Jamgotchian got up to speak a number of times, and at one point when he got off topic, Brackpool told him he was done. Jamgotchian kept talking, so Brackpool told him to sit down. He still continued to talk, so Brackpool yelled, “Sit down!” As Jamgotchian walked away, Brackpool mumbled into the microphone, “A very small man.”

Another quote I saw today:

"In fact, I found myself wondering whether any sensible and unbiased person could watch yesterday’s debate and believe that the sport will be saved from its precipitous decline into the mire by having people repeatedly spout the racing mantra?"

No, that is not about the CHRB meeting, it is about the racing situation in Britain, where they have some people making decisions that should not be making racing decisions.

Some neat statements on the Woodbine handle this meet from Bruce Murray. Where some other tracks try and fudge as much as possible (with per day, or per race, or per stakes race when they have six or more horses without a heavy chalk when it is sunny, handle comparisons), kudos for laying it out without any bee ess.

“Our average bet per race is up, and that’s in part because we’ve got fuller fields,” he said. “Our betting has stayed consistent, both on-track and in the U.S.”

For the week of Jan. 9, Murray said the average bet per race was up 11.5 percent, although the track’s gross on Standardbred racing dropped by 13 percent because of the cutback in the number of cards."

Jeff Gural was on the Meadowlands pre-game show tonight. As twitter noted 'he took a little shot at Vernon'. As you know, the Tioga horsemen have played ball, Vernon not so much. Tioga experienced handle growth last year after the horsemen approved takeout reduction, while Vernon suffered handle losses. You can watch the interesting interview here.

I appreciate how Gural's mind works on these issues. I think he is absolutely right when he says that New York will pass table games at some point and Atlantic City will get killed. The point he is making is simple: Do something big at the Meadowlands now to try and beat them to the punch.

Bloggers are smart. Well some are. They called Apple's quarter better than analysts did.

Sid Fernando, thoroughbred racings well-respected twinkyer did something today that caught the eye of some fellow twitter lovers. He retweeted a tweet by Hugh Hefner. That was cool. I was looking to retweet something by Lady Ga-Ga in homage, but I can't find anything beyond self-promotion. Sometimes I am very glad I was a teenager in the 80's.

VFTRG makes a good point in a recent column - we can not go backwards and wish there was no competition, we must beat them.

"Mickey Burke's trotter went from 9-1 to 7-2 last flash at the M" was a comment today on twitter from OBVern. Not uncommon unfortunately. Not only do you have to handicap perfectly now, you have to be Nostradamus with the odds board. It's a serious, serious problem that fixed odds would fix, but that seems about as possible as my beagle being the next Secretary of the Interior.

Rich Eng speaks about Billy Walters and we in racing needing one. Walters was not named by name, but if you'd like to check out a fascinating book on him and his team, try "Smart Money". It was a fantastic look through the betting landscape with offshore and onshore, and a man capable of making lines and arbing like the best Wall Street or Betfair trader. Some of the references to offshore books are comical since they do not use the real names, but they are close.

Speaking of offshore books, the word on the street is that they got killed on racing, even with a 5% rebate only - far, far too many sharp players playing millions of dollars a year. One of them has racing back with no rebate, trying it again. Without a price edge (i.e. some sort of takeout reduction), I have no idea how they will make it worth their while.

Friday, January 21, 2011

Charlie Seems Excited

Charlie's first foray into harness racing seems to be going well. The 30 year old thoroughbred player, and board member of the Horseplayers Association of North America, has never been involved with ownership of the hoppled ones before, but he took the jump with some shares in the Bourbon Slush stable. They have three in training with Lindy Farms' head trainer Frank Antonacci in sunny Florida.

Frank has been using social media for the most part to keep the stable updated and Charlie forwarded along this week's update.

It looks like the two pacers are doing well - going around 2:40 and having a nice break. The trotter is in 2:51 and progressing it seems. Those three horses seem to be right on track. We know how tough it is with yearlings (in both sports) and things can change quickly, but so far it looks like things are good.

In addition to a Facebook page (you can see it here), Frank is also giving some video updates, interviewing the people involved. I find this really important, especially to new owners. I personally love the people involved in the business - their stories, the care they give the horses etc. When you own a horse you are part of a team, and when you win a race everyone is happy. It is nice Frank is adding the team aspect from day one.

For a look at one of the yearlings, and an interview with his groom, take a look below. Well done folks!!

Thursday, January 20, 2011

Harness HOY at the O'Briens

What a difference a sport makes huh? You really have to condition yourself to think differently when dealing with Horse of the Year items in thoroughbred and harness racing.

The O'Brien this year is a tough one - or is it?

I read my monthly Trot Magazine and checked the tale of the tape, but as you know you don't really have to look at stats if you follow the sport. Regardless, for those voters who are not every day watchers or bettors, I thought it was a good summary.

The Candidates:

Big Jim - The two year old superstar of 2010 is certainly in the mix. If he won the Metro instead of going goofy on the sloppy track, he might be a big winner. Divisional NA champ, however.

Crys Dream - the best two year old trotting filly since Snow White. Divisional champion. She's going to have a tough time though.

Dreamfair Eternal - the best older mare in racing - north and south of the border. She should get votes.

Rock n Roll Heaven - the slam-dunk no question winner in the US, but he only raced three times here and that will be held against him, a la Goldikova in the US Eclipse.

San Pail - great horse, great story, but probably not enough for a HOY title.

Idyllic and Western Silk - both horses were not even tops in their division in 2010 in NA (See You at Peelers and Put on a Show), so there is little chance they'll get it.

My choice? If Rock n Roll Heaven would have done something up here, rather than jump at the half and come up sick in the NA Cup Final, he'd get my vote. He is the best 3YO since SBSW. So I am down to three candidates - Big Jim, Crys Dream and Dreamfair Eternal. Crys beat up on some fillies not in her league, so I would have to eliminate her based on that, and that she is awesome, but truly lacked a huge "wow" factor.

Between Big Jim and Dreamfair Eternal the separation for me is razor-thin, but I think I would lean to the former. Dreamfair Eternal went through a small stretch where she was flat, and it cost her some money and some overall respect. Waples could not have tripped her out any better at the M for example, and she simply did not fire in those big races. Big Jim showed up each time and really let them have it. His win in the elimination of the Breeders Crown showed some serious talent, and like I mentioned, other than the excuse in the Metro, the horse was a monster.

I'd lean to Big Jim, in a tough choice, but I have a sneaky feeling Dreamfair is going to win.

You?

Wednesday, January 19, 2011

Old Tux Club

There has been plenty of opinion on the Eclipse Awards this past Monday. Others have gone through the winners and losers and that's great - a bunch did a good job and stated their opinion sometimes eloquently.

One area not touched on out there as much has been the Awards themselves. I have read comments on chat boards about the crowd and I do tend to agree. On TV at least - it seemed like it was a sad bunch. One fan commented that even when Mary Lou Whitney spoke of horse retirement there were people sitting on their hands. On Ustream, where there was a live chat board going on, the comments echoed this as well. At 9:36 the live attached chat board exploded, however, with pure glee and passion; at a level I would submit was 100 times more than the room did.

That is not saying the room didn't at that moment - for the owners and trainers there Zenyatta was a solid choice, I believe this is because the people in that room know how difficult it is for a horse to race 20 races and fire all 20 times. It was an honest appreciation of a very special equine athlete, from those who work in the trenches.

Regardless there has been some serious talk about "involving the fans". I do not prescribe to this theory per se, simply because it is not our decision as fans. The Awards are the owners night. Buying and raising yearlings, paying huge stakes payments, living and dying when your horse's white count comes back over 10, and having to deal with all the ups and downs as an owner, groom, trainer or others involved with the horse is not a minor thing. It is their night.

Just as I think owners groups and horsemen groups should stay out of wagering decisions and leave it to experts and bettor behavior, I can see the same thing with the Eclipse Awards, or the Dan Patch Awards with the shoe on the other foot.

However, since Jerry Moss and others have brought it up; is there something that can be good for the game if fans are involved?

The National Football League draft is for teams, players and insiders for the most part and those decisions are not fan based at all. But fans are invited to the venue to scream and yell for their team. When Zenyatta won HOY would the venue been more electric with some fans there? I wonder, as a perk can racetracks hold Eclipse Parties for fans at special venues to participate and share their joy or dismay with the votes via live stream on youtube?

Should social media be involved? Is there any way to bring fans closer to the action to brand the event long-term?

Should there be a fan based vote which is included in the tabulation?

Or should this just be an owner day, which I think rightfully it is.

I have more questions than answers I guess, but I wonder if we might be missing an opportunity. I must admit, watching the event for the first time, at instances it seemed more like a wake and less like a celebration of equine and equine people excellence. I think we might be able to do better.

Any thoughts?

Tuesday, January 18, 2011

I Think I am Cheering for the Pack this Weekend but....

Bears fan Brad, and my favorite dude to argue with on the interwebs Ray P have started a handicapping contest. And the winner (hold your hats) gets one free year of Bris PP's. That is a freaking awesome first prize. You can sign up here and it's free, i.e. no takeout. Good for Ray, he's coming around to the dark side!

Takeout fighter and general all around good guy Bill Finley has a newsletter out for harness fans, called Harness Racing Update. It is pretty good and you can get it for free here. Andrew Cohen spoke about rake last time, and Allan over at View From the Racetrack Grandstand added a letter to the editor regarding some of our other issues. Good reading!

Is it just me or is the chatter on the web less caustic today regarding Horse of the Year? It seems the choice, although some people disagree with it, is being fairly well-received, in a broad sense. The chat boards are another story.

Nice article on retired horses and taking care of them here.

What's with the "just say no to slots" policy happening out there? First Illinois, now more news from Mass. The business, sooner or later will have to depend on customers, and customers only.

A very, very important lesson in racetrack economics here regarding the Meadowlands. In Hong Kong, the head of wagering there testified on how customers are creatures of habit in racing, and when you mess them up, they are extremely hard to get back. The Meadowlands, through little fault of their own, has had a tough run and the track that was branded as "great fields and great racing" had that brand challenged for some time. This meet has been very good with some good racing again. However, fans are slow to come back. The brand has to be rebuilt, in my opinion, or at the very least they will have to think hard outside the box to get things rolling again. Word of mouth is huge in the horseplaying game. I wish them well, and I hope long-suffering players who have simply given up give them a chance.

There is one huge opportunity left I feel for the Meadowlands, and that is exchange wagering. If they don't mess it up with infighting or trying to dictate rather than listen to a successful betting firm (I know, probably a pipe-dream in our racing), it can energize a few folks. Should they get it passed for harness racing with the UK betting giant, it can make a difference.

Handle, which I have not compared too much, must be doing somewhat better as the $50k guarantee on Thursday's is back.

Canuckland Doesn't Miss Out - Thanks to Ustream and Youtube

Up here in the Tundra we never get to see the Eclipse Awards because TVG is banned like a trans fat plate of fries. I received an email yesterday evening that I could watch the Awards on Ustream. That was cool, because I have never seen them before and I wanted to see them, like many up here. For those of you in the land of beavers who have not seen the coverage and announcement of the big vote, Youtube has it up now, and it is below. Gotta love the Interwebs, huh? The surprised look on Jerry Moss's face certainly tells us that this vote was not expected by that crew.

Monday, January 17, 2011

What Are We Going to Do Now?

With Big Z winning the horse of the year, it ends a chapter lasting a couple of years where arguing about the mare and her rivals (some of it pretty nuts) ruled the roost. It got me thinking, what in the heck will we talk about now?

Here are a few items I think - no I know - will be happening in the next while.

Blame and Zenyatta will be entrusted to paint Moneigh's for horse charities. Someone on twitter will complain about Zenyatta's minimalist style, and say the Horse of the Year vote was a huge mistake.

It will be said someplace somewhere, that "Synchronicity" was a much better album than "Zenyatta-Mondatta" and it will be related to tonight's vote. Do Do Do Do Da Da Da Da was on the latter, so these folks might have a point.

DRF Headline: Zenyatta might have 60,000 friends on Facebook, but Blame got Steve Crist's vote. Take that!

Zenyatta won Horse of the Year, or did she? Jessie Ventura goes in depth on Conspiracy Theory.

A psychology paper will be submitted at Fordam at some point this semester titled: "Did Seth Hancock look unhappy because his horse lost, or because he always looks unhappy?"

Ray Paulick is going to write a feel-good article about Zenyatta's win being a big thumbs up for California's takeout increase.

Someone who sells speed figures will say the horse of the year result ends "a sad chapter for horse racing"

Someone will post on a chat board that the voters are dumb, and someone else will point out that last year he posted that the same voters were smart.

Uncle Mo will win his first start by seven widening lengths, and we'll be on to something else.

That last one sounds good to me. I hope everyone enjoyed the evening!

401k's for Horses? Harness Twitter Peeps & Lightbulbs

You know sometime when you hear an interesting idea and say "why didn't I think of that?" Reading the interview of one of our blog friends here - Caroline Betts - that moment came for me. She runs the So Cal Thoroughbred Rescue and when asked if she had something she could do for retired horses what would it be, she replied:

I think my “nirvana” is for all industry stakeholders – state and local governments, owners, breeders, trainers, private owners of racetracks, and fans/gamblers – to agree that a 401K should exist for every thoroughbred racehorse prospect, with the funds contributed by all and centrally managed and dispersed. How large should it be per horse? Just large enough to ensure that if that horse cannot or can no longer race or breed, there is a reputable, approved non-profit specializing in the retirement and/or transitioning of racehorses that is willing to take it in at the time of the horse’s retirement.

That is amazingly interesting, and seemingly workable, as she explains. I wonder though: Will young colts be going after old mares for their 401k's?

Caroline is also packing a Phd in economics and answers some questions on juice. When asked if the optimal takeout for horse racing is lower, higher or accurate, she notes:

Almost all studies of own price/takeout elasticity show that demand is “elastic” at the takeout rates prevailing in the samples studied; i.e. that takeout rates were above the optimal rate and that revenue could be increased by reducing them usually by a substantial margin.

I know what you are saying "Pull, that is like saying hitting yourself in the head with a crock pot hurts!" But we're a bunch of dumb bettors, so it is good to hear someone fancy tell us that we all aren't bat crap crazy.

Check the interview out for that, and the really cool pic of her and Zenyatta.

How many Santa Anita execs does it take to change a light bulb? I am guessing a lot, because they all seem to be spending their time arguing about their handle. Jessica analyzes.

It's Horse of the Year day! Zenyatta, or Blame? Please discuss elsewhere :). I am going to be glad when that is over. We have at least three years before her first foal is criticized for his slow maiden fig.

Benny Beam is back. The twitter feed for Benny was silent of late, but he was back this evening to bet some racing, make fun of Tom Brady, and cuss. There are not too many harness players on twitter - if twitter depended on harness players for their revenue stream, they would be IPO'ong for like six bucks - but he is one. After twinkying a winner tonight, he said (edited, since this blog is read by tons of five and six year olds):

bennybeam666
how the f*** dont i have a million followers
6 hours ago Favorite Retweet Reply

Benny tends to be a little off color, so follow at your own risk (but he is an astute industry observer and bettor). I personally think he might get to a million followers, however. For you harness peeps, there are a few folks to follow who don't swear and stuff: @GregReinhart, who says he is the most "hated poster on Harnessdriver.com" (not true, he likes to think so) and @OBvern, who is one-third of my stable, and a sharp player. Our other part of the stable is a professional gambler, and he does not tweet, but he is handy to have around when Vern and I are broke and the horses bills are piling up.

Speaking of pro players, I don't think I linked the most-excellent interview with Mike Maloney here. Mike is a fantastic player and a great guy. Anyone see 60 Minutes tonight about Billy Walter? That's what Mike is talking about in that portion of the interview.

Yonkers is going to 1 1/16th mile races. It probably won't make a difference in a speed laden game, but it's worth a try.

Enjoy your Eclipse Award day everyone!

Saturday, January 15, 2011

Horse of the Year Dogma

I, like a lot of you have followed the horse of the year chatter in thoroughbred racing. In harness, it's easy and it usually is. There are no set rules or criteria for our voting, and Rock n' Roll Hanover is the horse. If he is not voted HOY in harness I am pretty sure Fed Ex messed up on sending the ballots out, and they got re-routed to the planet Zoltar. In thoroughbred racing, as seems to be par for the course, the debate is about as clear as a mud milkshake.

As this article says, there are no "rules" per se. But as Steve Crist and others note, there is a fall-back dogma.

“There have never been any rules for it or guidelines,” Crist said. “If you look at the history of the thing, it’s usually the best horse in the open division, and the times people have gone elsewhere are because there was no standout horse in that division.”

Indeed, male dirt horses dominate Horse of the Year voting. And when a season lacks an older-male dirt horse, voters have as an automatic default the year’s 3-year-old champion.

This to me, is striking. In harness racing, for example, we would never do this, ever. There is no litmus test or dogma, or fall-back plan based on what others say to do; we generally vote for who is the best horse, or "superstar" of the year. That can be a two year old filly, older male, older female, whomever.

People have spoken at length about HOY this season and have given us stats, strength of competition and all the rest. That's great (although I have purposefully stayed away from it here, because often times it polluting). But I wonder, should Zenyatta lose the HOY vote again this year, if this does not expose that our sport is doing something wrong in their HOY dogma above - eliminating the common sense horse.

Zenyatta is a superstar, and even her detractors note that. She retired the highest money winning mare in history, tied for the most grade 1's by a mare in history, she's the first mare to win the Classic and first mare to come second in the Classic, in that races' history. She is a dual surface mega-winner and is 19 for 20 with one second over three seasons.

Throwing everything else out, and all the other debate out the window: Does it make common sense to anyone that she would go zero for three in HOY voting, with that resume?

I think what we might be seeing here with the general public (where Zenyatta wins polls by a 3 or 4-1 margin) is not an indictment of voters - people who vote for Blame are not stupid. Read one paragraph of a Steve Crist or Beyer book to figure that out - but an indictment of the dogma of the process itself.

A horse with that resume (or ball player or quarterback for that matter), should at least have one MVP, or HOY Award, don't you think?

People ask for stars in horse racing, and they believe the general public will latch onto a horse and make this sport a better one. I agree with that to some extent. Well, what does it say to the general public when the biggest star in racing in the modern era is not even a one-time Horse of the Year? Dogma or no dogma, stat or no stat, Beyer figure or no Beyer figure, it makes little sense to me.

Friday, January 14, 2011

Chipmunk Attack

I had someone say something a couple of days ago (I have not asked permission from him, so I won't post his name) to me: "In all my years in racing, I have never seen more momentum for horseplayers and fans to finally force long-needed change."

He was referring to the organized boycott of California racing.

I am beginning to agree. I have been working with the group as much as I can because I clearly support the initiative, and often scan the news (I am on the massive California email list sent out by a couple of people in racing, too) . There is a big narrative change.

Only two weeks ago it seems it was all a joke of some sort - "those whiny horseplayers; they'll get tired of it soon, stop whining and fall into line." But I find the opposite has happened. My email box is littered with comments, sometimes from bigger players who I have never heard from. I hear from the HANA folks and discuss some items with my pals and everyone feels there has not been this much energy, perhaps ever.

Speaking with another insider today I heard rumblings that breeders are even starting to speak the player language on issues, which we all know is very rare. I am not sure we've seen that ever.

I have noticed it on the various industry websites as well. When a topic came up about takeout, it was kind of ignored. Someone would pop on and say their piece - a trainer might say something about "putting on the show" and that would be it. Now, no longer. It is populated by horseplayers saying their piece.

Some websites are still towing the party code, but when they get out of line, there is hell to pay now. There was a couple articles today on a popular website that players found insulting, and inaccurate. They sprung into action. The article was picked apart, piece by piece.

The opinion press itself has been on this story and saying their piece. Art Wilson's article today is something that would never have been written one year ago, or maybe even six months ago, for example. Equidaily aggregated no less than three separate links today to boycott chatter.

In general, horseplayers who truly care about the game's long term health are out there, but they are not very involved. Clearly many horseplayers worried about issues like pricing have long left racing - our handles have been decimated. Others have a whole "nothing will ever change in racing so why bother" ideal. As well, it is an older demo, and not on the computer each day like a Poker Player Alliance member, so they are difficult to energize like the PPA has. The pool is a small one to fish from, quite frankly. But the folks who are out there, seem to be less silent now, and they seem to be growing.

There is something going on here that I can not put my finger on. I don't know if it succeeds or fails. I don't know if my feeling is real, or only memorex. But there is something going on here that I have not seen before. I have a sneaky feeling the chipmunks have finally had enough.

One Pen. One Line.

Jeff Gural about five or six years ago said (paraphrasing) - 'when the government comes to take slot money for itself, racing better have an answer.'

In Indiana, that time is here.

"The proposed Indiana budget bill includes a line item that would almost cut in half the amount horse racing receives from racetrack slot machines.

Currently, the industry gets all of the 15% of adjusted gross revenue from slots at Hoosier Park Racing & Casino and Indiana Downs. The budget bill offered by Gov. Mitch Daniels would reduce that amount and shift 43% of the industry’s revenue to the state’s general fund."

Thursday, January 13, 2011

Lamarra, Tanner, Cummings & Pricci

Tom Lamarra gets kudos for breaking the barrier. He writes about the California situation here.

I received a note from Kate at the USTA regarding my post about "CRM" and my feeling we lack it in racing. She forwarded an editorial from Mike Tanner, President of the USTA, that agreed.

"We need to gather a significant amount of demographic and psychographic data, and then use technology to organize and synchronize our business processes to effectively deliver a message that will resonate. It’s called Customer Relationship Management. Getting started isn’t cheap, but if done correctly, it can be very effective. Want proof? The casinos live and breathe it." he typed.

Further:

"Knowing our current fan base can also tell us who our potential customers might be, where we might find them, and how we might best connect with them." he said.

I met and listened to Mike at a wagering conference and I came away impressed. He, like Kaplan at SC, are a part of age-old institutions who lived and thrived in a monopolistic time. We all realize (or we should) that good people work in these places that realize we need to change. The thing they have to do most is: convince the people who don't think we have to, that we do. When horseplayers and horse owners get frustrated with that leadership and fly off the handle when things don't move, I hope they pause for a moment and realize that. It is a very tough sell. Think newspapers of 2002 when the same things we were warning about with racing five years ago are not fixed today.

Brad Cummings and John Pricci are having an Internet tete a tete on customer service. It's a bit of a weird one though, in my opinion, because they both essentially agree. John is not saying "customer service for the racegoer" is bad. Brad is not saying "takeout reductions are not a part of service." But they are tangling a little (which is not a bad thing, both have class and respect for each other).

In my old days of studying service through courses etc, we were constantly barraged by "PMCE's" - the goal of any organization is giving your customer "positive memorable customer experiences". That involves price and service and they go hand in hand. Your goal will hopefully not only get that person to come back, but to tell friends too. Example that I gave: You walk into a store, you are greeted nicely, it's clean and welcoming. The sales staff is courteous and everything works very well in the store. You buy something and go to the cash where you are greeted with a smile and a "scratch and save coupon" for 5-40% off your purchase as a promo. That's a PMCE, and that is something that racing should strive for, whether online or elsewhere. Take your customer through the process of going to buy, then giving them a break on their purchase where they get greater value for their money. It's not either or, it is part in parcel the same thing.

For a racetrack it might work like this: You get a $10 buffet (like Kelly and the crew do at Grand River). Your waiters are first class and you are treated well. You are given between race entertainment like they do. But throw in a John Pricci twist of a takeout reduction. At the end of the fifth race, all your tickets that are losers can be thrown in a SAM machine and given 5% of their value. All money has to be rebet. Some of that money will be winning tickets and people will leave happy. The next day at the office they say to coworkers: "I went to Grand River and had a great meal, was treated well, and in the fifth race I used my losing tickets to bet and I hit a tri for $300. It was "free"!!!!

That's a PMCE, with Pricci and Brad teaming up to make a happy consumer. The good thing about the price reduction though - it's rebet - whereas a purchase at a store is not.

Notes:

The Meadowlands Survival Challenge is up. It is always very popular with harness players. Sign up if interested.

Meadowlands ups Pick 4 guarantee to $75k

Allan has some notes on the fair start rule he has been working on.

Wednesday, January 12, 2011

San Diego Union-Tribune Beats the Racing Press

Today the player action in California regarding the boycott of California racing was discussed in a lengthy article in the San-Diego Union Tribune. This struck me as interesting, as the racing press has ignored the story.

If a group of retiree's were protesting something, it would make a retiree magazine first, and a regular paper (if they're lucky) somewhere down the line. If a bunch of poker players organized to change something, poker mags would have it, and it might make mainstream papers later. If a bunch of cigar smokers were asking one of the brands to do something, I suspect Cigar Afficianado would at least mention the story before the New York Times.

But not in our sport, thus far. There were some columns on this at Horse Race Insider, or Bill Finley's spot on ESPN. Actually, Standardbred Canada ran a story and Ray Paulick ran a story with the picture of a chipmunk - so there is no excuse it should not have been on a radar. But the big US racing "trade" papers thus far ...... crickets.

So, they knew about it, I would surmise they could have emailed to investigate, because after all, Finley (an Eclipse winner), Christine (an Eclipse winner) and Pricci (former Newsday writer) did and made a judgment on the validity of it.

Maybe one might think it has not been touched in those magazines or sites (in the month or so it has been announced) because the group is radical and it wants crazy policies. Maybe the group has some public figures who have a bad past or something, and they are better muzzled. Maybe so, who knows. It's possible.

Let's analyze.

From the website the group (one I support) wants:

1. A gambling board set up in CA. On that board they would like a wagering economist or two, and professionals who know wagering, to vote on wagering concepts, and not political appointees with little expertise in wagering.

2. Takeout to be lower because they believe we should lower prices to grow horse racing. Every piece of literature in both gambling and economic journals ever written supports that view.

3. They'd like to look at (the gambling board to look at) full card simulcasting (in CA you can only bet select races) and elimination the rebate cap for CA bettors, which they have long-complained about, and probably have hurt handles and CRM there.

4. A study to be commissioned to lower horse ownership costs in CA (which should help increase ownership and up field size).

I might be missing something - but I really don't think that sounds radical.

How about the people who are its face? Maybe there are some strange apples in that crew.

Jeff Platt, a programmer who was entrusted to program for Fortune 500 companies and now runs a software business and bets the races is its head. Barry Meadow, a player who has written books and writes for the American Turf Monthly has been on the radio about it. Roger Way, a retired tech exec has attended CHRB meetings for many years and is well-known in the state has been a force. These folks say they would like people like these two to serve on the Gambling board in CA: Caroline Betts, who teaches at USC, runs a horse rescue and has ran small horse sales in CA, and Cal MacWilliam, a Ph.d who is employed by the World Bank and has taught economics at Vanderbilt and Carelton Universities. Both of those economists have allowed the group to use their names.

I find it funny that there is not even a mention in the racing trade press to possibly forward some solid, honest, intelligent debate between intelligent people to hopefully help our sport. If they were breeders wanting to change something, is there any doubt they'd have a story up already?

I am convinced the racing press does not, and never has wanted to rock the boat to change racing. It is not an indictment of the people there (just like in racing it has great people who want change to happen and the sport to grow), it is an indictment that there is another fiefdom in racing worried about their slice.

CRM

John Pricci this morning talks about customer service being important in racing, and he cites some of the things Gulfstream Park did this meet in helping that cause. I have a slightly different take on it, kind of like I explored below.

I don't believe racing has to do as much with customer service as it does with CRM - Customer Relationship Management.

CRM, defined by Wikipedia below is this:

Customer relationship management (CRM) is a widely-implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service.[1] Customer relationship management describes a company-wide business strategy including customer-interface departments as well as other departments.[2]

If a person comes to your racetrack to watch the races and have some decent food, it is more customer service. Keeneland is a good example, as are various Ontario harness tracks in small towns.

For bettors, those who may play daily or frequent your track to bet, it is much more than that. They are clients, not unlike a client of a lawyer, marketing firm, or financial advisor. Those clients need more than a seat and a good burger, they need to be cultivated. Here are a few examples:

If you were a Pharma sales rep, and a client who buys $100k worth of product from you each month suddenly does not place an order, you are on the phone with that person asking why, and addressing their needs.

If a client of a financial advisor asks for fewer and fewer trades in a month, and is not as responsive, something might be up, so you call.

If you are a horse trainer and your client, who usually have ten owners to buy yearlings in September, but hasn't been in contact, you are opening the lines of communication.

In all those instances, CRM is employed. The Pharma sales rep might learn that another company stole his business because they were not offering a certain set of drugs. He can report that to corporate and they can start studying what people are demanding and map the future.

The financial advisor might learn that this person got $5 trades at an online broker and was doing it him/herself. He might make a plan to still manage the persons retirement savings and offer some free advice on hot stocks.

The horse trainer might learn that the yearling game is not for this customer, but adding him to a partnership, or offering to claim a horse instead might do the trick.

It's all about communication, fostering the customer, addressing needs and cultivating him or her to come back, or spend more time and money with you.

In racing, this does not seem to occur. Our customers do not seem to be cultivated.
A couple examples:

About five years ago a friend left a racetrack where he played serious money via their "player card". He bet over $200,000 a year for years, but he just stopped. He found an ADW that would give him better rates, so he switched. He did not even receive a call from the track asking why he left. He is betting 10 times as much now.

I spoke with Jeff Platt (of Jcapper and HANA) recently and he told a story about the post parades at one track. The pony and rider was blocking the horse's view in post parades and customers were complaining to him. Could he ask them to change their post parade so the 90%+ people who are betting the track via simo can see the horses better to make a good betting decision? He called and spoke to them - the answer was no, the horsemen did not want to change.

We have a long way to go to be that pharma rep, trainer or financial advisor because I believe we lack proper CRM skills in our business.

Tuesday, January 11, 2011

Eyeballs are the Most Important Metric

I remember working back in the mid to late 1990's. A research report came across my desk on a dot com company that I had a bit of a laugh at. The stock was listed and had little chance of profit for a few years, but they were growing "eyeballs", so this analyst thought they were a buy. I telephoned a friend who is an investment banker and we shared that laugh. We both found such metrics completely false in determining profitability.

A couple years after the dot com bust happened, it turns out the metric was not a specious one, the stocks were just overbought. Eyeballs are a metric that any business needs, because when you have eyeballs, you have critical mass to make money. Just ask Google.

After several years in racing, where the braintrust has concentrated on trips to state houses for alternative gaming money, dealing with horse owner issues, raising prices or managing like bean counters looking at next weeks revenues rather than next years, it has completely missed the mark. They were not concentrating on eyeballs.

In our sport, an eyeball is a person that is betting money into our pools. We have pretty much completely ignored him or her. We have not tried to make them a better horseplayer, we have not tried to cultivate them as a paying customer, we have not tried to grow their gross number. It seems we have simply looked for ways to make them go broke faster; just like California's shocking takeout hike did in September.

Look at what one simple, forward thinking move can do in this regard: I spoke via email to a small player who had pretty much given up on our sport. He was playing in an ADW which did not give him a couple dollar break on takeout when he wagered - he might get a toaster if he bet enough, but no money back - this despite the massive economies of scale advantage the new medium was afforded. I told him he should try a new place, that each day would give him a 3% or 4% return on takeout. I said "if you bet smart, and try and churn some money, you will play for a little while and have a little more fun." It was a tiny salvo to try and save one player from leaving - to keep an eyeball.

A few weeks after he sent me the following via email:

I registered for the account and I must say I am impressed. All they need now is free video and programs. I like the smaller tracks like Monticello and Northville... I even tried a place ticket on a 3-1 greyhound...... best yet.... I started with 100........ betting frivolously and stupid, I blew it all... but the next day I had 23 dollars in my account.... and then last night.... I got the 23 all the way back up to 100 and then blew it all again ... but anyway I managed to bet about $700.... So now they throw $35 back in my account................ I'm back to the slow grind.

I have not spoken to him lately, so I do not know if he has stuck with it. However, this small, tiny player, ready to give up, instead sounds energized about racing. Not to mention, he contributed hundreds of dollars for purses.

Think about the difference of what California has done. They have not given that player back a couple dollars to replay, or to feel energized about racing, they simply tried to squeeze a dry lemon for the last few dollars in his pocket. And the results bear this out: This takeout hike has been an abysmal failure.

What can racing do if we start thinking about one thing only, and did it for say two years: Drive eyeballs. A customer that stays in racing can be an eyeball which can be cultivated and can contribute to our sport in dozens of ways for years. A customer who leaves racing is a lost eyeball who never comes back.



Monday, January 10, 2011

Horse of the Year Offshore - Nowhere?

At this time last year the talk was hot and heavy with Rachel versus Zenyatta and their Horse of the Year battle. And in the words of our UK pals, it was easy to get a "punt" on who you thought would win.

Wynn's casino had it up in November (Zenyatta favored at 1-3), betfair was rocking for awhile, with plenty of action as I remember it . Zenyatta was favored early, then Rachel by a scant hair late. Ehorse and other offshore books had odds up as well fairly early.

This year? Betfair has the Derby odds up (there seems to be a 15-1 arb opportunity for about $18 on To Honor and Serve if anyone is interested), and some others have it as well, including the Vegas books. But I can not find one book offering odds this year on the Horse of the Year (other than a passing reference on a chat board with no link).

It is a super-strange battle to begin with. Usually offshore books are damn close on things like this. If you read "The Political Punter" there are some great stories on how accurate the odds are. Intrade is quoted on places like CNBC and the Fox Business Network on current events, elections and more because of their laser-like accuracy on elections and events. As I have always noted and believed, you can tell how someone truly feels about an event (politics is the best since people have their favorites) by asking them to wager money - they might hate Bush or Obama, but when you ask them to vote with cash on an election return, they suddenly like 'em. Last year in the Horse of the Year vote many places made Zenyatta a strong favorite, and were very wrong. That is very rare.

Are offshore books gun shy? They might be. Quite frankly last year (when if I had a vote I would have cast it for Rachel Alexandra) I would have played her at even because a) I thought she deserved it and b) the east coast boys loved her. This year if I had a vote it would go to Z, but at even would I bet her? I have no idea what I would do at even. I think, perhaps, the goofiness of this betting, year over year, but especially last year when bettors and oddsmakers were pretty wrong has scared off a lot of people predicting this vote. Any good bookie knows, when you offer something out and are so wrong, you don't want to come back a next time. Markets that don't make sense are markets you want no part of.

For what it is worth, the votes on the web polls are the same as last year. Queen Z is loved by fans and a lot of bettors in this sport and she wins those easily, yet the ballots that have been made public seem pretty split. In my informal look this year from three people who play professionally, they are 2-1 for Zenyatta over Blame, while being 3-0 for Rachel last time (if that means anything at all). But I know one thing, like some offshore books it appears, I could not make a fair odds line on it. I have no idea which way this vote goes.

If you see an odds line anywhere out there, please let me know, because I can't.

Lend Me $7K? I'll have a 20 for 20 horse. And Betting Maxims

Zenyatta just missed going 20 for 20, but one horse completed that task at the Meadowlands this weekend. St. Elmo Hero won his 20th in a row. He has been chalk all but once.

The interesting part of the story is the fact that this gelding was claimed out of his first career start (a win of course) in a $7000 maiden claimer. Checking his lines, there was nothing in them that showed he would go on to be a good horse, so that $7k plus allowances seems to me to be a shot taker.

It paid off: The horse has now won $145,000, racing primarily at lesser tracks.

See screenshot below for a snapshot of his career, courtesy the link to Track It stats.

One post today that won't surprise you folks in the least, since most of you are bettors, comes from the Horseplayers Association. A dude on a Hold em/Sports betting chat board or two or three asked a simple question to those players: "Why don't you bet horse racing?" Their answers are here.

I think my favorite was this one: " It just seems impossible to beat. I'd love to see someone have a great day at the track. Like "Trotter" in the movie "Let it Ride." But, that seems like great fiction."

When our target market thinks it is nothing more than a pipedream, or pure fiction to beat our rake, we don't have much of a gambling game do we. I wonder if Chris Moneymaker thinks the same about poker? How about Alan Boston with sports betting? I guess the article on "Positioning" speaks to the concept.

It is something this business does not want to discuss. We'd rather gloss over it, deny it exists, or call them names, but it is there, and there is little chance to fund $1B+ in purses long term by selling t-shirts, so it better damn well be discussed. It is something you will never read in a trade mag and it is on the reading list.

More required reading for industry watchers who have a devil of a time understanding the market: "Maxims of betting life" by Scott over at his blog. A couple:
  • Losers think of selecting the winner and beating a race. Professionals think of betting for value and beating the races.
  • The best handicapping literature in the world are your own records.
  • If you want to make money ... big money ... do what nobody else is doing.
The whole list is good, and things we all do every day when we bet horse racing.

The Serial Horseplayer kills me. His "Onion-type" satire site is funny. He is interviewed via a blog here this week. He is calling for more drug testing in racing, but not on the horses. I admit, I laughed. It's impossible not to laugh at a lot of his stuff.

Wild rescue of a standardbred here.

Lines of the $7k maiden claimer, St. Elmo's Hero. Want to go back in time? Click to enlarge.





Sunday, January 9, 2011

Interesting Betting Pattern at Santa Anita

In today's six race at Santa Anita, according to a chat board or two (and now the drf), there was some funny wagering patterns. So, I had a gander at them.


The 4 horse "Bad Boy" was 1-9 for a lot of the betting. At about two minutes to post, it appears some money left the pool.


There was $77,606 at three minutes to post in the win pool, then there was $75,680 at two minutes to post.

The winner dropped from 8-1 at five minutes to post to 3-1 final. The second place horse moved from 13-1 to 5-1 over the same time period. "Bad Boy" closed at 9-5 and did not hit the board.

At an offshore exchange, it appears there were no weird patterns, so it seems this was all pari-mutuelly fuelled, possibly by one bettor canceling ticket(s).

Friday, January 7, 2011

Good Retirement Initiative & Hailing the Grey

"Dignity After Racing" is launched for our retired harness racing pals. They are bred by us, and taking care of them, since they allow the participants in our sport to earn a living, seems like a no-brainer. However, (although I have not many anyone who thinks horses are expendable after they stop racing) we do not spend enough taking care of them.

"An Organization of horsemen, breeding farms, racing centers, and horse lovers devoted to seeing these wonderful horses that so many of us benefit from have a life of dignity and love after their racing, breeding or days behind a buggy have come to an end." says the mission statement.

That's good news. The participants need to help, and many of them do, but the more we can get to jump on board, the better.

I have always wondered why we have not done more in this genre. With the slots money coming in, why didn't we allow for a very small slice to go to retirement? In Ontario a portion of wagering goes to it, but in many jurisdictions with slots, nothing does. A lot of it goes to breeding, which is fine, but when I think of stories like Pickle, who was born to be sold as a racehorse yearling, but had a facial deformity and ended up one step from death at a meat sale, it frankly, makes me mad.

Can we not do something to fund an initiative? Drivers/jocks and breeding farms make their money by breeding and sitting on and behind them. Can a small slice be preserved for the horses to make sure they are taken care of later? We can't save every horse, but we can save some.

Since I am fired-up, as I usually am on this issue, and I have so many east coasters visiting here (the east coast is a harness racing hotbed, as you can see here, for those who do not know), can I share a story?

A place with a big heart and who I have fostered for is called Beagle Paws. Beagles are great pets. They have a dog that needs a little help. He has a really bad disc condition and he is a rescue from hunters. You can see how bad he was here in November:



After some care he has blossomed:



But he needs surgery so if you click the above link and want to help you can.

The province of Newfoundland has some laws that are old and out of date on animal protection. These dogs are used for hunting and can be pretty much thrown away if they are not good hunters (some of the dogs Beagle Paws have rescued there were found abandoned on the side of the highway). Ads like this in a local paper are completely fine (from their website):

"I am looking for an excellent hunting dog, I don't want JUNK. Will pay right price for a really good Beagle.
If you got JUNK I don't want it."


Talking about a dog like he is a piece of junk makes me ill, as I know it does you too. With this kind of ad I suspect the paper had to correct about nine spelling mistakes when they received it, because no human with an IQ higher than a popsicle could possibly write it. If you live out there and are looking for a wonderful pet for your family (they are amazing pets) please contact them. You won't be disappointed.

Like horse retirement here, we need some new policies in a lot of places, in my opinion.

I have deep respect for everyone in racing who is helping in this selfless regard. It is so nice to see places like DAR popping up and I applaud every trainer, driver and breeder who gives it the help they so deeply deserve.

Off my soapbox now. We'll be back to racing and betting tomorrow. I thank you for reading if you got this far.

All hail the Admiral

Admirals Express, the iron-tough winner of more than 80 races, passed in November due to a leg injury. He not only rocked fans on the racetrack, but in his brief retirement was an ambassador raising money for retired horses.

He was a superstar.

It was announced this week that he received the Cam Fella Award, which is a once a year award that goes to someone (or some horse) who goes above and beyond the call of duty in harness racing.

I was so very happy to see him win. We are all sad he is not out there enjoying retirement by barrel racing, bouncing in a paddock, or meeting children and introducing them to the wonderful breed that is a standardbred; but this is a nice award.

He deserves it and we'll miss him.

Thursday, January 6, 2011

Big Start to the Meadowlands Meet

Despite a possible storm tomorrow in the NYC area, it looks like it is full-steam ahead for the Meadowlands 2011 harness meet.

We have been used to short fields, but the race office has put a couple of very nice race cards together, which feel a bit more like old times. Friday's card has a plethora of ten horse affairs, and Saturday's is not a whole lot different.

I've been a busy dude for the past couple of days and that will continue, so unfortunately (or fortunately, is more apt), you will get no pearls of wisdom from me :)

Good luck to everyone who is playing. One thing is for sure - 2011, even for a couple of days - looks more like 2005 than 2010. That's a good thing.

Wednesday, January 5, 2011

Owner/Bettor Respect - Why Fight When we Can Solve Problems?

There are a few topics out there in cyber and media land about the connections of a horse (those who supply the product), and the people who bet on them (those who demand the end-product). Usually it ends up in a food fight.

The story about a recent article in Ireland where the jock of a horse who faltered as chalk (i.e. was taken for a bit of a fitness trip) said,:

"I've always been a man to look after a horse. That's the way I ride them and that's not going to change."

it prompted the question to be asked "Who is more important, the connections of the horse racing for a purse (i.e. the owner and rider and trainer) or the people who supply the purses they run for (i.e the betting customer)?" This question spawned a ton of responses, most of which were like this:

"I don't care about the bettor. I care about myself and my horse. We've got slot money funding 95% of our purses. Let them whine all they want. Good riddance."

"Don't ask me to wager my money if you're planning to stiff me."

"There you go. ABSOLUTE PROOF that racing is fixed, and ludicrous horsepeople who actually want to justify it."

I think most of that is counter-productive.

Long-ago when we were a monopoly, when a bettor got mad, he came back. Just like a trainer at the tack shop if it was the only one for 500 miles, he or she had to grin and bear it, and keep buying product, regardless of the service. Today a bettor does not have to take it, because he/she has choice.

As a gambler I can hopefully tell when a horse is being taken out for a run, or when someone wants to prime their horse for an effort down the road. For me, it is not a huge issue - we can use trainer stats and much more to try and decipher intent. But to increase fan participation in racing, and increase our betting base, we need to look at more than a 25 year handicapper like me.

Today's society expects a fair shake in any game, or product. If I am playing Intel puts, I expect the company to be on the up and up, and I expect that no insiders are selling them short because the news out in three hours is good. I expect my bingo balls not to be weighted against me, or a dealer not to be dealing from the bottom of the deck. It's the way we live our lives as consumers.

If a horse pulls back to last, who leaves the gate constantly (this is more of an issue in standardbred racing than thoroughbred), it is a pox on our house - there is no denying that. If a horse was off three weeks, got $400 of vet work, was trained up solid at a farm somewhere, and bucks every trainer trend on a database and wins by seven (these horses as a rule are horrid bets in harness : about 0.45ROI), it is a problem.

Rather than yell at each other who a rider or a driver or a trainer should be racing for (I am both a bettor and an owner, so I seem to get yelled at twice), why not agree on a few things, and fix them instead?

1) Riders and trainers and drivers should be racing with one thing in mind: The welfare of the animal.
2) We need to realize that it is not 1950 any longer and we can not tell our patrons to shut up, sit down, live with the status quo and bet

So what do we do? In my opinion:

1) Educate customers on intent, as any handicapping book does
2) Open up policies where they are transparent

I have firmly believed (and I have brought this up at industry conferences, on the blog, and to racetrack execs themselves) that we need a new system where the connections of the horse, and their intent on today's race are public.

For example:
  • On condition of entry, a form must be submitted on intent. Was the horse off a month with a cough? Is he fit and ready, or is it time to "trip the horse out"?
  • What's the story last time? Why was the horse last by 30? A vet database is set up where after a race if a horse scoped sick, or if his white count was through the roof, or he had a bad problem during the race, customers know about it. We can make reversals of form and the endless wondering done by customers if we all cheat to set up a bet, a thing of the past
  • We employ paddock personnel. The connections are all there. Can't all of them be asked a simple question: Is your horse ready? Can't it be made public via twitter, or scroll along the bottom of the screen? Horse trainers are not crooks, they love talking about their horse and his health. If one of them chose to lie, he/she would be exposed faster than a easter egg at Kate Plus Eight's house.
Before you say the words I hear so often: PTP, you are nuts, this can never happen; well it is happening.

* Hong Kong has a vet work database and it is public. Handicappers use it all the time.

* Australia just instituted a new system where "race tactics" have to be given before the race.

* Woodbine and Grand River Raceways always chat with trainers beforehand on intent. Drivers and jocks too. It's not a stretch to expand it by adding all connections and scrolling it on TV screens, on the toteboard, or via several social media outlets.

The words "we can't" permeate racing in NA like they are some sort of a slogan. I think we can.

Some people are doing it, we need more to. We can try and solve problems, or we can continue to call each other names, as bettors leave and handle and purse revenue circles the drain. How about the former for a change where we all win?

Racing Businesses v Our Businesses

There was a post today that I read with someone talking about how tracks raise revenue. He gave two options:

1) Raise take
2) Raise Signal Fees

For the raise in take or signal fees, this example was given:

"If a track has a $1 million handle with a 20% takeout rate, the takeout is $200K. Rise the takeout to 23% drop the handle to $900K and the takeout is $207K. One reason why the takeout is so high, is time and time again it has been profitable for the tracks to raise the takeout."

That gentleman is correct. This is racetrack business right there. Raise the cut, lose some customers, but gain a little bigger share: Poof, more money. It is the way this business has been run for a century, for the most part (takeout in 1906 was 5%, it is now 22%).

Conversely, you have to go into work tomorrow and you have a meeting on growth strategy. You would like to continue growing and you have 20 clients, but would like to have 25 at the end of the year. That is your goal for growth.

If you walk into your meeting and say "I have a plan. We can raise our price to our 20 clients 20% and we would grow", your associates would think you have been taken over by space aliens.

Clearly if you did that, you would lose at least two clients, and as time goes on you would lose the trust of more and more of your clients - they would be wondering if you are really out for them, and it would breed badwill. The two clients lost would tell others your company is too expensive, too, and you would find it harder and harder to gain new ones because of that. In addition, by raising your price, it would be harder to gain new business, even from whom did not speak to the ones who leave, because you are overpriced.

At the end of the year you would make more money - the bump in revenues would cover your loss of two or three clients. But the fact would be apparent: Your business's future would be in peril.

Jack Nicklaus said "Tiger Woods plays a game that I am unfamiliar". For many of us racing is much the same.

Monday, January 3, 2011

Some Large Bettors Say No To Santa Anita

I received an email Saturday night around 10. It was from an acquaintance on the left coast who is more than likely one of the largest individual bettors in North America (one never knows for sure because they are notoriously quiet) asking me to ring him. I had not spoken to him for over six months, so we had plenty to chat about. The conversation at one point was about the California takeout hike and the loss of betting handles there since the meet began. I called him today and asked if I could write up some of our conversation, and he said yes.

"They really have no clue the damage they have done to the gambling customer there, do they?" was the immediate response.

This bettor told me that he has not played a cent into the track this meet.

"I have not even watched a race - actually no, I have watched two races because friends owned the horses in them but that is it."

He went on to relay that people in his craft (he has been betting for a living since he was 18 years old and other than owning horses, makes all his money from the races) are equally annoyed with the sports direction in the golden state. As you might not know, larger bettors tend to know each other, are friendly, and (a good book on people who bet for a living and their relationships is here if interested) share views.

"Out of the guys who I have told you about before, two are just dabbling nickels and dimes at Santa Anita, one is betting much less, I have stopped cold turkey along with another. The last guy is looking for a new circuit to bet and tells me he has been studying for that. It's unlikely he'll come back, unless something changes there. The ones who are still betting obviously operate on very thin margins so if they see their day to day results dropping [e.g. with the higher takeout], I'm sure they'll quit and just go for carryover pools and I'm pretty confident that will be the end result."

It is always difficult to estimate what's a "nickel and a dime" to large bettors like this, and it is not proper etiquette to ask, but from knowing the culture for many years, I would submit it is somewhere around $2000 to $4000 per day. Estimating the yearly betting volume from these individual bettors is also hard to guesstimate, but somewhere from $4M per annum to $10M or $12M each is probably a good guess. It is extremely stressful to bet any more than that as an individual bettor and stay on top of things.

As for him, racing not only in California is bothering him - although he calls the takeout hike enacted by the CHRB there "pure insanity" and it is the reason he is not betting - it is the whole industry structure. He believes when a track exec here speaks, they don't speak his language; they might as well be talking to him in Swahili.

"There are some circuits I bet, certainly, but more and more I wonder what to do. Hong Kong is something I am looking into. Big pools, nice horses and proper takeout where I might be able to make 2 or 3 points if I work hard. They [management] seem to know what they are doing there, but it is a lifestyle change as I would have to live there, and it might take me six months of studying to prepare, so I don't know."

You can tell a lot about the health of a gambling game by looking at how many pros there are. In poker there are hundreds of thousands and they promote that game for them. In sports betting there are many thousands. At those gambling games, takeout hikes do not, nor ever have existed. Your neighborhood bookie in 1920 knew when juice goes up, players do not play because you tap them out, so at the grassroots level (minus any fancy degrees, just pocketbook smarts) they have maximized revenue by maximizing customer satisfaction and turnover. The rake on sports betting is the same (or lower) today than it was a hundred years ago. In horse betting there are very few pros (some estimates say "250" full time players who have stuck with it, not just done it for a year or two, or "think" they are winners), and that says a lot. As time goes on, the number seems to be shrinking, and that is no good for anyone.

Whatever the case, it seems that the early results at Santa Anita are not a mirage, or an aberration, or just due to "whiny $2 bettors". They reflect a systemic problem that needs to be addressed. A change to 4 days a week at SA where year over year comparisons might look better, double carryover days like today making things look not as horrible (carryovers are takeout reductions, which is maddeningly ironic), or headlines saying everything is fine might make us feel good, but feeling good doesn't pay the bills.