By now I am sure many of you have heard of the Equilottery. If not, the company advertises itself as a conduit that “allows lottery players and horseplayers to compete in the same pari-mutuel pools on live horse races.” In effect, you go to the store and instead of betting numbers on a lottery, you bet numbers on a horse race. The concept of getting new money into the pools is perhaps the most intriguing characteristic of the venture, because, as we’ve said more than once in this column: In 2014 horse racing is not your grandfather’s horse racing.
Back when horse racing had a monopoly (or near monopoly) on gambling, it attracted virtually everyone; sports fans, gambling addicts, recreational bettors and almost any other slice of the population enjoyed the pursuit in some form. As time moved on and lotteries, sports betting, slots, table games, and dozens of other avenues, both online and offline, dotted the landscape, a great many of these bettors were lost.
Now, horse racing is left with diehards, a small legion of $2 bettors who like the sport, and computer or big rebated players, trying to squeeze a one percent margin on their yearly volume to pay the bills. In a pari-mutuel game plagued with massively high takeout, it’s not a barrier to growth, it’s a modern day Maginot line that tells gamblers to go do something else.
Horse racing is sold as a place where you can “beat a race, but you can’t beat the races” and never before have truer words been spoken. Despite $15 billion in yearly handle, only a tiny fraction of bettors’ truly do beat the game. It’s dog eat dog, shark on shark.
Poker saw a resurgence in the late 1990’s. Some think it was due to a movie called “Rounders”; others think it was a pocket cam; some think it was the World Series of Poker where an everyman (or woman) could walk away with big money. I am certain all of those things played a part; however, I think the influx of new money brought in more new money, and old money, too, which was a far more important catalyst.
During that time my current stable partner, and long-time University friend was managing a courier service, but found out quickly that the “dumb money” in the poker pools was there for the taking. After a year or two of making an hourly poker wage that was much higher than his employment hourly wage, he quit and became a gambler. That’s lasted until this day.
When new money is brought into a game and that money is less informed, it attracts more money because the game has what gamblers call an edge. That edge brought my friend into poker, along with thousands of others. Gamblers found a place with critical mass and edges where they could make money.
In horse racing this concept is not a whole lot different.
I remember, back maybe a dozen years ago, I was asked by a racetrack manager at a tiny handle slots track what he could do with some of his slots money to increase his handle. I, off the cuff, said bet $100 on each horse, one through eight, every race. Because each horse’s fair odds are not 7-1, money must flow to balance the pools. With $800 “seeding” a win pool, it’s both a takeout reduction and incentive to bet. Additionally, with a win pool size reaching a critical mass, it can attract simulcast dollars.
Whether that would’ve been a good use of his slot money is anyone’s guess, but my off the cuff idea was steeped in gambling tradition.
When the horse racing industry thinks of horse lotteries they think of getting a slice of what’s bet into the lottery itself for purses and profits. They think this might bring new fans to the racetrack. They think it will be like Sweden. Maybe those things can happen, I don’t know. But, it means much more than a few fans coming out on a Friday night. It helps seed pools, just like a seat at a poker table with a newbie and a fat wad of bills.
If $500,000 is bet on an Equilottery pick 6, many of those $1 or $2 combinations would be quick picks, uninformed bets, or bets that are well below fair odds for the ticket itself. This builds an edge, just like betting $100 on every horse in a win pool does. Me, you, and every other semi-serious bettor wants a piece of that action. It’s better than a pick 6 carryover every week, with a 10% rake.
If that $500,000 in new money enters a pick 6, the money from existing players – long upset about rising takeouts, poor fields and terrible betting propositions – suddenly find somewhere to park their dollars. If they were planning on leaving racing, like many have the last ten years, here’s a reason to stay.
When existing gamblers see an opportunity, they pounce, and they aren’t the only ones. If big enough, and interesting enough, the pools can attract some of the people that horse racing has lost; those whom racing thought they lost for good; the people who patronize the half a trillion dollar skill game gambling market. Big pools with public money aboard help sell racing as an avenue that’s open for business, and that’s never more important in the current, highly competitive gambling climate.
Racing has long looked for ways to bring people to the racetrack. Billboards, promotions, food trucks, giveaway’s, bands – almost anything that can be tried has been tried. Those things have not raised handles, and have not created new bettors, because, frankly, they have nothing to do with gambling. The lottery concept is something that has not been tried in North America, and unlike a falafel, or a Stray Cats concert, it adds money directly into the pools, and that money can attract more and more money.
Horse racing should begin to embrace the concept and work with those trying to bring this idea to bear. It’s an idea that on the surface is new, but in the realm of gambling principles is as ancient as the first set of dice. Because of that, it has a real chance to be a game changer.
This column originally appeared in HRU.
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