A few racing stories caught my interest today.
First we have two from Hong Kong, one from Britain and one from Australia.
In Hong Kong there is an attack on pari-mutuel pools from the internet. Both horse wagering and things like online poker threaten their revenues. If you read between the lines in this story the narrative is much different than on its face. Internet wagering is here to stay, so it looks less of a cry for help to block it (like we heard in North America from 2000 to even today), than a cry for better taxation or more business choice for the club.
The second Hong Kong article (from Equidaily) talks about just how well the HKJC is doing in the face of new competition. As we have spoken about here several times they have addressed many issues with taxation, takeout and other means and have seemed to nip the losses in the bud.
"The job is far from done but the comeback in the past few years has been impressive, with pari-mutuel turnover now hovering around $100 million a race after getting down as far as the low $80 million figures prior to the tax restructuring, rebates and turnaround."
Article three is from the UK. There is currently a big fight out that way with funding and the like, trying the 1995 thinking. You'd think its on its last legs. However, it has a pretty good hold on the gamblers - much better than here, for example.
"Wagering on horse races remains popular in comparison to the two previous studies of 1999 and 2007, falling between figures from those two surveys as racing registered 13% in 1999 and down just slightly from 17% in 2007."
Lastly from Australia. Only five years ago there were members of Aussie parliament saying exchanges were pretty evil, even going so far to say that they were funneling cash to terrorists. There would be blood on the streets if they don't give us all their money, they would pilfer pools and cause corruption etc.
Well, the five years have gone by. In terms of almost every other jurisdiction 2010 was a fabulous year for Aussie horse racing. Adrian Dunn of the Herald Sun looks at the experience:
Outrageous predictions were made. Mafia-style thugs would stand over jockeys, who would jump off horses mid-race so that shadowy figures who laid horses to lose would secure a windfall.
There were also claims that Betfair would grab all the money and run, returning nothing to the industry. Leading trainers and jockeys were urged by Racing Victoria to put their names to a document slamming Betfair.
Damon Runyon, the famed author of the 1930s, would have lapped it up.
.... It may be many things, but certainly not the ogre that some painted.
I think the experience and response in those three countries is telling. Adding customer choice and making the product you put out customer-driven will allow for change, and it will allow racing to hold its own. No, the handles and revenue are not on fire and we are not growing like a weed, but our brand (racing live animals in front of people) is not a growing brand.
What Hong Kong has done and is doing is restructuring to be a present day gambling enterprise. They have done that and handle is approaching mid-1990 pre-internet numbers. It is not going anywhere.
In the UK the brand is solid, and consumer choice (you can bet pick 6's, jackpot bets, WP with a bookie at 6% take, WP on an exchange at 5% takes etc), is a big part of that.
In Australia, despite seemingly years of saying the sky is falling when you add bettor choice, things are doing quite well (2010 was a gross handle record year in Australia and purses were up all on their own).
Here in North America, with more alphabet organizations than a chapter in a Tom Clancy novel, the myths, infighting and actions on terribly bad data continue. We have branded malaise. If we start branding to customers like it appears we might be doing in some jurisdictions, we have a chance to have a good second decade. Growing handle is not such a pipe-dream. Growing handle while protecting the status-quo at all costs is.
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