Reasons to Switch, and Eaves Steps Down

Bloomberg Business Week produced a comprehensive look at Daily Fantasy Sports gambling today. For those looking to educate themselves on the demographics, growth rates and strategies, it's a very good read.

For a gambler to "switch" from game A to game B it takes some sort of impetus, or catalyst. For a poker player featured in the article, who needed something to do after Black Friday, he chose DFS:

"Max Steinberg, 26, is a Vegas-based professional poker player with career winnings of more than $2 million. So like a lot of online gamblers, Steinberg is now into daily fantasy sites such as FanDuel. Steinberg works with his twin brother, Danny, and their older brother, Aaron. Together they wager about $75,000 on hundreds of contests each weekend during football season, and an additional $3,000 per night on basketball. When baseball starts, they’ll spend about $10,000 a night, and more than $1 million over the course of the season."

DFS sites offer a gambler reasons to switch. An ability to make money, sign up easy, and compete in a game with a possible positive EV.

Racing had hoped to get online poker players after Black Friday, but that never happened. Let's look at the impetus for Mr. Steinberg to switch to racing, right now, this January.

1.  He can bet a higher priced game than it was in 2011 - Signal fees have gone up, rebates have gone down. The largest criticism by gamblers regarding horse racing is that takeout is too high. In 2014 and 2015 it's gone even higher.

2. He might not live in the right state - Source market fees, killing every day players edge's, have come in, or are active in New York, Viriginia, Pennsylvania. In Michigan, good luck betting over the net on racing, and ditto Texas and Arizona.

3. "Impasses" - Tracks are fighting over what's left of betting handle, shutting out customers. Oaklawn Park opens today, and a half dozen of my serious betting friends who are trying to make a living at horse racing can't even bet it at their ADW's.

4. Field Size - Field size is down, making the races harder to win at.

Why would anyone switch to horse racing? This has been going on for years, so the next time you see someone in racing's braintrust say that "game X has been outlawed, so it should help horse racing handles" make sure you remind them that racing's issues are not competitor issues, as much as deep-seeded fundamental issues within the game itself.

Nick Eaves stepped down as Woodbine head today. Nick was a thoughtful CEO, able to juggle politics and business quite well. Woodbine is much more player friendly today, than it was five years ago, and that has been reflected by handle increases. They have a long way to go, but he changed Woodbine for the better.

PS: If you want to try Draft Kings you can with a referral link. If I can't beat em, I might as well join them.


Ron said...

It pains me to see santa anita doing well so far this meet. Rebates for small bettors have been butchered, takeout is outrageous and yet they're doing well. This will give them even more reason to raise signal fees and increase takeout rates.

Anonymous said...

Santa Anita (and TOC etc) is hundreds of millions poorer over the last few years. Any short blip up or down is like putting out a fire in a trash can while the entire block is still on fire.

Anonymous said...

Santa Anita will not be up by July. If they are it will be minimal.

Ron said...

You may be right about it being a short blip, but short blip or not, this will empower Stronach and other tracks to raise rates and takeouts even more. You could say " dont' bet santa anita then". Well I could be NY, but their talking about raising signal fees. There's Gulfstream or Tampa, well their fees have gone up and rebates down. Ok just bet Oaklawn, well Oaklawn is blocked to my adw.


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