Sunday, March 31, 2024

Fixing the Open Betting Skies Game Could Use Some Tweaks (Some that Many Probably Won't Like)

Air travel began to be deregulated in the 1970's. Business people like Southwest's Herb Kelleher and others could fly the friendly skies, delivering a service to millions. 

However, how could passenger airlines grow as an industry if planes were unsafe?

In 1970 there were 3,218 fatalities for every trillion dollars of passenger miles. In 2018 there were just 59, a 64 fold decrease. 

Even with throwing an industry open, safety innovation improved incrementally year over year, sometimes in the lowest tech ways possible, like moving a button or a pedal that might be mixed up in flight. Economic historians tell us it had to be a focus, because the long-term life of the business depended on it. 

As we all know, gambling markets have been blown wide open since about 2018. Today we're not rummaging through betting slips for our bet from Sam the Bookie, we're not stooping for tickets at Belmont. Everything has changed. 

Is this a good thing or a bad thing? 

One writer at the Atlantic, shared by Crunk, doesn't think so. He believes it's making sports worse, and he does make some worthwhile points. 

  • Same game parlays with real time apps on phones results in some serious bankroll succkage, and could certainly be at least partially described as predatory. 
  • Sports leagues, seeing this cash shot directly into their veins, are all to happy to share prop bets at halftime of games, especially those that are blowouts. 
  • Leagues and networks partnering with gambling companies feels, well, kinda sub optimal doesn't it? 
In horse racing, I think we have many of the same characteristics. 

In 1970 when Herb Kelleher was working on building an airline, racing was humming right along. The nine race card at your local track had a betting array of win place and show, maybe a double, a few exacta pools and a late triple. Takeouts were pretty fair, considering it was a monopoly. 

Fast forwarding to today, we can bet every exotic bet imaginable, almost 24/7, with racing from dozens of countries in the world. It's all there, with the push of a button. 

In the background lurks the computer teams who - and this certainly never happened in the 70's - blanket combos on these hard to hit bets, while getting a huge price break compared to the rest of us. The result, as we all know by now, is a massive effective Dick and Jane takeout, breaking every day customers each and every day. 

The sports betting and racing industry can say that they're just giving the customer what they want. And hey, I'm probably more libertarian than the next guy, but come on. The bottom line is you've created a system that's built in the long-term to break your core customers. 

The Atlantic author and Crunk feel that the sports betting ecosystem will settle and change, at least from a broadcast perspective. I think they're probably right, on the surface. It's easy to not push gambling and real time wagering as much as they do, because people are tuning in to see the sport first, and the gamble second. It will likely be in their best interests. 

However same game parlays, 40% takeout wagers and all the rest? That's more of a nut to crack, because even the states are drunk on this revenue.

Over in racing it's the same story, in my view. There is zero doubt in my mind that going back to more of a 1970's betting menu - with some tweaks like saving the big sweep bets to certain days - would be beneficial to your average customer. There's zero doubt lowering takeout, or expanding rebating would help the player. I have no doubt that regulating the pools could still keep team-play a thing, without the subsequent damage.

But I also have no doubt a pivot like that in this new, free, unregulated industry will never get done. 

Back in the 1940's a dude by the name of Alphonse Chapanis was wondering why air accidents were happening and he noticed that tired pilots were mixing up a pedal which resulted in the flaps being engaged instead of the landing gear. Engineers moved the pedals and it wasn't the problem anymore. The airline industry realized that it wasn't going to find pilots or passengers without constantly tweaking, innovating and getting better each and every day. 

Horse racing, as well as the online sports betting wagering industry, has built the fuselage, designed the landing gear, and they've got themselves a pretty nice plane. The passengers seem to be enjoying themselves n' all, too, at least on the surface. But, I can't help but think they're flying it right into the mountain.

Have a nice day everyone. 

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