(Somewhere Else) Horse Racing Has "Been There Done That"

The Tinky-Mike Repole King of All Horse Racing battle on the twitter is kind of interesting. 

I guess battle is not the right word, since Tinky's blue checkmark 3,239 character missives are usually met with one word replies. But they're interesting to me nonetheless. 

Tinky

Most of what Tinky and the rest of the horse racing world talks about, in my view, is what Crunk calls "Groundhog Day". We've been through this many times before. It's rinse-wash-repeat. 

And it truly confuses me. 

I got an email today from Microsoft detailing a new feature. Microsoft owns Bing, which is a search engine like google's is, and they have their own ad platform to drive search revenue, just like google does. For 15 years or more, Microsoft tried to create their own "thing" to deliver ads. They spent money, they experimented, they created various iterations of platforms. 

However, over the last six or seven years, their big corporate change is to do whatever google does. If google changes an ad type, they do. If google creates a new set of audiences, a month later they do. 

This change is not because they're lazy or dumb. They realize that google will i) try and maximize their ad serving revenue (it was over $200B last year) and ii) have reams and reams of data and engineering to support the change, so the change is probably right. 

The thing is, horse racing has that, too. 

We argue about fixed odds, like it's something new, like one of those Stanley tumblers everyone wants. Fixed odds for horse racing has been around for three centuries. 

For a dozen years we argued about exchanges. Betting a horse to lose, cannibalization, revenues, margins, blah blah. Meanwhile, it's been running for over twenty years already in several parts of the world for horse racing. 

Fixed odds has been perfected over the years. Sure people can get tossed if they win too much, but it's a vital part of the ecosystem in places like the UK and Australia. It drives reach and revenue, and it's there if people want to use it. It's changed over the years and continues to. It's profit driven, and for the most part taxed on profit so it drives near optimal revenue. 

Exchanges are like some new bogeyman in 2024 in North America, but they happily drive reach and revenue just like fixed odds do. And they innovate and change as well with regards to prices and profits. 

A bunch of years ago Racing Victoria downunder wanted more money from exchanges, so they increased the hold. This brought in less profit, so they reversed their ask and went back to the hold around 7%. How many times have you ever heard a racing jurisdiction ask to lower the takeout to a bet taker with data to back it up?

This goes for a lot of other things in this sport. Field size, driving horse ownership, allocation of purse funds. Many places have "been there done that".  They are more centrally run, they have the data, they have tried things over and over. 

The UK, Australia, Hong Kong are not perfect and everything isn't wine and roses, but they have done much of the work for you. No one is starting from scratch. 

The job of "racing" in North America, whether it be the Jockey Club, or Repole, or the Tinkster, is to create some path that allows the sport to use the work that's already been done by others. 

For Microsoft it's easy. They simply create a platform with an ability to mimic another. 

For racing, it probably is another Groundhog Day moment. But it sure would be nice for them to focus on that side of the issue, than to start from scratch when much of the data is only a google (or Bing) search away.

Have a great weekend everyone!