Modern Technology Kind of Wrecks Things

I read an interesting column today at Around 2 Turns. It was in regards to the American Pharoah Triple Crown, and the assorted memorabilia of such.

"Ephemera, or at least the hobby of collecting it, is dead or at least seriously unwell. Sure, a dinner menu from the Titanic or a JFK campaign poster still holds some residual value to somebody somewhere. But if Antiques Roadshow is to be believed, the market value of such things has been in steep decline for quite a few years. The pet theory here is that technology – aka, the Internet – has made such things less valuable because digital images of them are so easily obtainable. Why spend money on the real thing, when a perfectly nice digital representation of the thing is just one free click away?"

I think that's so true.

Years ago, well in the 1980's when I was getting into horse racing, I would keep a lot of things. Program pages from races, tickets, souvenirs. I did so like so many others did.

I remember when VCR's came out. We bought one, but for some reason the store shipped us two of them, and for another some reason, when alerted, they didn't pick up the extra  - no matter how many times we called - for around a year. Having two VCR's was the bomb. I taped every race that was shown, even a few stretch drives from the nightly sportscast, and with a second VCR could make a mixed highlight race tape. If my friends in school liked racing I would've been the coolest kid ever.

I cherished this tape, and still do until this day. "They" said VCR tapes would die after so many years, but they were clearly wrong. That baby still works like a charm. First Breeders Cup, check. First Breeders Crown, check. Derbies, North America Cups, a grainy stretch drive of Cam Fella running down Millers Scout, Easy Goer and Sunday Silence, check, check and check.

Today, did I tape American Pharoah's win? I don't even think I've rewatched the race (honestly, it was - other than the obvious - not exactly a barnburner.)

We can watch any race on Youtube anytime. I can buy a program. I can order archived SI's. For $20 I can buy a $2 win ticket. Surf, click mouse, buy. It's all just there, as the writer alludes.

Simulcasting is a great thing. I can bet on a horse anywhere, anytime. Wonderful. But from a from a being-a-romantic-fan of great horses point of view, it sucks.

Back in the 80's, Greenwood/Mohawk (the now Woodbine Entertainment Group) had the Canadian Pacing Derby, the North America Cup and a few other races where we'd actually get to see the horses we'd hear about. Was Call for Rain any good? Was Jate Lobell? Who knows, because we'd never get to see them. A trip to the track for these races, for a racefan, was like a four year old going to Disney World. Although Woodbine rarely attracted US Thoroughbred talent, I could get my fill of the gaiters with no issue, and it was magic.

Now, I can watch any horses career with a click of a button. Why go to the track to see them? I know what they can do, because it's old hat.

People say it's easy to be a racefan now, and they're right. We can do and see almost anything, or buy almost anything right from our home office or living room. Seeing things we have not seen before at the track is gone. We live it, bet it, watch it and rewatch it each day, we can buy it with a mouse click. The 'old days' are indeed gone. But, nostalgia has a pull. And often times I miss it.

Enjoy your day everyone.

Shuffling Around the Recipe in Pennsylvania & The Dreaded 'Monetization'

Good day racefans.

Over in good old Pennsylvania there have been a couple of interesting developments.

First, Philly Park Parx is cutting winter dates and sinking money into a fall festival of racing.

"Parx Racing and the Pennsylvania Thoroughbred Horsemen’s Association (PTHA) announce the creation of a new, annual $20 Million Parx Racing Fall Festival that will commence on Saturday, Aug. 29, 2015, and continue through Oct. 20, 2015. By doubling purse levels throughout the two month festival, Parx and the PTHA have created a signature racing meet that will attract top horse racing talent in the industry, increase the field size of the races, enhance betting interest, and draw new fans to the racetrack."

What we have noticed empirically, is that when purses go up, it is not strongly correlated to increased handle. Some people inside the sport, and some pure fans, can't seem to get their head around that, but it's not really that much of a paradox. If you serve up six horse fields going for $50,000 instead of $35,000, while asking players to play into 30% juice, your handle probably won't increase much. It's like a restaurant increasing the wages of their serving staff and improving service, but still serving bad tasting pasta, at $35 a plate. The bump from better service does not fundamentally change your restaurant.

What Parx is doing is preferred, however. They are splitting off a meet and creating a separate meet with some buzz. I believe all slots tracks should've been doing this since forever. When I have brought this type of short meet up there were crickets; mainly from the argument "the horsemen won't go for it". But I did, and still think, it's a good idea.

Parx could really create buzz by lowering takeout with the shorter meet/festival. That's the Kentucky Downs model. But they won't because well, they're in Pennsylvania.

Meanwhile in the Keystone state, we are seeing slots revenue further wean.

"Up to 250 slot machines could be placed at OTW parlors under certain regional restrictions. The state tax rate on the slots-only facilities would be 54%, none of which go to support purses and breed development programs."

Fewer dates and a decrease in revenue off new machines seems to be the general elixir.

Racing in Pennsylvania has always been a 'what might have been' for me. So many riches, so little long-term vision.

Moving on to the Mike MacAdam column about the changes to Saratoga, and NYRA and Chris Kay in general, it's been quite the buzzsaw (there are 50 comments on it at the Paulick Report).

It seems people have given up; that racing 'companies' can and will do everything that they want for the short term. That's fine, but the meme that this is taught in business school and it's just the way it is perplexes me. What a load of nonsense.

Companies market and position themselves in the marketplace with the long term in mind all the time. It's a massive part of business. Travelers Insurance doesn't charge people to use these charging stations (even non-customers), they do so because it makes for good business. Ball teams are not sponsored by the local mill because they're "monetizing", they do so to be a part of the community they reside in. In my town growing up, the big Toronto 'corporation' didn't have management deliver turkeys to miners Christmas morning to monetize some offshore investment in a turkey farm.

And Frank Stronach doesn't do what he often does in this sport to 'monetize', that's for sure.

NYRA seemingly wanting to charge for the air that someone breathes at Saratoga and CDI masquerading as the big bad wolf, are outliers, not doing "what everyone does".  Travelers Insurance could monetize a charging station, but it would hurt their long term business so they don't. CDI and NYRA might be hurting theirs too. There's no need to throw up one's hands and say 'that's expected' from these 'corporations'. It's not.

There's a fine line to walk between monetizing and pissing off people so much, the drip drip becomes a wave, and the wave becomes impossible to stop (think the long-term destruction of the betting base with seven decades of marginal takeout increases as an example) . Good "corporations" walk it finely and with skill. If you love the sport and want to see it flourish, demanding the same of horse racing entities isn't even remotely radical.

Have a nice Monday everyone.

MacAdam on Saratoga: The Modern Enterprise, Old School Game

The Gazette's Mike MacAdam penned an article today about Saratoga Racecourse that should get its fair share of tweets and retweets. He writes what oh so many in the sport would like to say - or more appropriate scream - but don't have a forum to. It's about the monetization (Mike, not wrong in doing so, calls it gouging) of almost everything.

"It’s one thing to look under every pebble in the quest to turn a profit. That’s all that a corporation is about. And it isn’t NYRA president and CEO Chris Kay’s job to win a popularity contest.
But NYRA is playing with fire at Saratoga. People are — what is a “P” word I can use for angry? — perturbed. Perhaps there will come a point when that starts to reveal itself through the kind of metrics Kay prefers, like hotel tax revenue."

You should read the article. If you like the romanticism, the feel, the everything that makes a racetrack a racetrack in a community, I suspect you'll like it.

This is nothing new, quite honestly; managing to EPS, managing to today. What's going on is not subtle or some grand experiment.

In The Other Side of Innovation, Vijay Govindarajan, a professor at Dartmouth's Tuck School of Business, talks about traps that old-school enterprises can fall into. One of them - the strategic trap - is when the 'performance division' of a company tends to steer the entire ship. This process is a trap because it focuses solely on the marketplace of today, with little regard to past branding, or future, long-term ROI. It appears some racing companies are hell-bent on being married to this strategy.

I will disagree with Mike in one of his points: "turning over every pebble for profit is all that a corporation is about." The best, most successful corporations have innovation divisions, and creative branding that's a large part of the overall strategy. That's what stops the Kodak's of the world from being the Kodak's of the world. On the surface, and looking at the continued monetization of the nation's most storied, most branded Thoroughbred racetrack, unfortunately, as Mike ably and passionately writes, it appears NYRA is not one of them.

Enjoy your Saturday everyone.