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Friday, December 24, 2010

Christmas Takeout

Well, it's almost that time. For Santa Anita, of course, and the much-anticipated - by a lot of people other than me - return to dirt racing there; and the grand opening day card featuring two gloriously full-fielded Grade 1 races to mark the occasion.

Hovering over the festivities however is the talk of a bettors' boycott over the rise in the takeout rates for exotic wagers. I discussed my feelings about the takeout issue in this post (one of my most popular in terms of response in 2010). And again, if you HANA guys want to spend Sunday betting on Turfway instead of Santa Anita because its cut on triples is 1.68% lower, that's up to you, and fine with me. Since you're such smart guys, your money going elsewhere should create enough value at SA to more than make up for the takeout anyway!

In a much blogged-about post encouraging the boycott, Bill Finley wrote:

There's nothing wrong with putting more money into the pockets of owners, trainers and jockeys but to do so at the expense of the downtrodden horseplayers is, frankly, sinister. No one is more deserving of a break than the people who bet on horses. They are what make everything in this sport go and they have had to put up with nothing but abuse, starting with takeout levels that make the game all but impossible to beat. Now they want to take even more money out of the Average Joe's pocket. This is criminal. []
Whoa, Bill Finley. I don't really buy the concept of the "downtrodden horseplayer." I certainly don't put myself in that category, do you? Quite the opposite; as I count my blessings during this joyous time of year, top amongst them is the fact that I'm lucky enough to have enough disposable income to participate in my favorite game, and the temperament to do so as a pastime rather than out of compulsion. I know a couple of people who have to stay away due to the latter. Anybody who truly falls into the downtrodden category probably needs to find something else to do, or seek appropriate counseling.

Finley seems a bit hysterical here overall. He makes it sound like people are herded into the track and forced to bet. In fact, nobody is taking any money out of Average Joe's pocket here. The Average Joe doesn't go to the track. Instead, he's downtrodden and abused by the MTA, cable and satellite TV providers, health insurance companies...and I could certainly get more morose than those. So, lighten up, man.


Teresa said...

"No one is more deserving of a break than the people who bet on horses."

I can think of an awful lot of people more deserving of a break, not the least of which would be the people who are on the backstretch at 4 a.m. taking care of the horses, and those workers' families.

I think that there's a case to be made about takeout in racing, certainly, but such over-the-top characterizations do more to undermine his point than to support it.

Merry Christmas, Alan. Nice game last night, but my God, that shoot-out was brutal.

Anonymous said...

I agree with Alan I don't think 26% takeout is high enough.
If we raise it higher this will make racing better and bring more people to the track and help our sport.

wmcorrow said...

I find your comment on the downtrodden gambler of horses repulsive and reeking of vomit.

In your world, apparently, only those with disposable income, those who have ample income from their job or whatever, should be gambling on the horses; those without sufficient income should be shown no pity - being suckers to hope for a huge score with their buck.

The fact that takeout zeros in on a dollar, not who is wagering it, seems irrelevant to you, as you can afford it.

A coal for you this Christmas eve.

DiscreetPicks said...

I lean more to Bill Finley's side. The takeout in horseracing already far exceeds the juice in other areas of gambling, be it football or baseball or even casino games. And yet, the politicians in charge of this sort of thing continue to dip into the takeout whenever they see fit. Where is it going to end? And keep in mind, this is IN ADDITION to the thing that no one ever seems to talk about, BREAKAGE. Don't even get me started about breakage.

I just thank goodness that the winpools have gone largely untouched, as the target of most takeout increases is the usually the exotic wagers. But i really feel that takeout should be going down, not up. Horeplayers have paid more than their fair share for too many years, yet they're always asked to pay more. Why? What do they ever get in return? High admission prices, concession prices, and Racing Forms that cost in excess of $5 each? It's amazing the tracks survive at all. Eventually, all the current horselayers will die off (i'm sure you realize we're not a young demographic), and then what wil be left? If horseracing is going to survive long-term, it needs to be competitive with other forms of gambling. And the tracks/politicians always seem to be making that less so.

PS - I'm encouraged by the recent stories about horseracing getting moved into some sports bars in California. That's the kind of thing we neeed more of. We need to get more people involved, asap.

Anonymous said...

You wrote: "Since you're such smart guys, your money going elsewhere should create enough value at SA to more than make up for the takeout anyway!"

It is ignorance like your comment that keeps the CHRB ticking. Good luck burning your bankroll and being a contributor to HURTING the overall industry, not helping it.

alan said...

>>In your world, apparently, only those with disposable income, those who have ample income from their job or whatever, should be gambling on the horses; those without sufficient income should be shown no pity - being suckers to hope for a huge score with their buck.

Yeah, that's about right. So, you're saying that people who can't afford to be betting on dumb animals, and who may be doing so out of either desperation or addiction deserve to get a break with takeout? I find that remark to be repulsive and reeking of vomit. Why don't you step back and think about that?

And to the rest of you, I'm not saying that higher takeout is a good thing. I am saying that its significance varies to different people depending on what they're trying to get out of this. I go to have a good time, and I don't go expecting to win. I'd rather play a stellar card like the one at Santa Anita than on a bunch of dogs at Turfway, even if it costs me a little more. And I'm saying that Finley's column is rather overdone and that, as Teresa said, there are people in the industry that are suffering a lot more than some spoiled horseplayers sitting at their computers with the world at their fingertips. Ask the poor folks on the backstretch in Maryland. The reduced takeout experiment didn't save the industry there, did it?

Anonymous said...

Yes,I agree with you Alan the Horse player is "spoiled"

That is one reason for takeout increase.It's also for the children.

Thank you for your support.


Cangamble said...

Supporting a move towards higher takeout is supporting the death spriral of horse racing.
Oh, and Turfway isn't the only alternative to California racing. There are plenty of other tracks where value can be found. And many that are actually either reducing takeout or looking to in the near future.
You can have California. I haven't bet a dime there since the bill was signed. I'm holding out because I'm doing my part towards growing horse racing. I won't bet into a California pool until this ridiculous takeout hike is rescinded.
You'll also find many who boycott California are those who constantly lose money betting on California tracks(99% of all bettors lose). So if you think there will be more value created because of this boycott, you really aren't thinking it through...or you had to make up a reason to bet California. There is none.

markinsac said...

This is interesting: Racing is losing customers in droves because it is not competing with other forms of gambling. The takeout on horse racing is ricicuously higher than: sports betting, live and online poker, casino games and slots. In fact horse racing's motto should be: A better bet than the lottery and nothing else!

To Mr. Disposable income: There are people unemployed, or like me, have had their salary cut drastically. While you celebrate your wealth, I'm taking my gambling dollar where it will strecht further.

California raised their prices at a time when people are buying less and less of their product. And the public is also getting tired of drug-cheating trainers ruining the game.

"California, there I go . . ."

gib. said...

"downtrodden horseplayer" for 40 years or so - never considered takeout, never will.

They own the game. We just play.

The toteboard relays the odds. If the price doesn't meet the need - move on.

Horse players should spent more time playing horses and less time trying to run some other guys' business.

What is the typical casino takeout?

gib. said...

I just read "markinsac said..."

Unemployed folks who lack disposable income should have no complaints about take out - they should stay away from gambling period.

Figless said...

We all, even Alan, believe that takeout should be lowered, but government should take the hit, not the folks that put on the show.

But Finley and HANA are over the top with their boycott. Good luck, take you gambling dollar elsewhwere.

I will be playing this terrific card, on dirt, tomorrow and not feeling the least bit guilty in the process.

If you really want to put fannies in the seats, and help the "downtrodden" horseplayers (as opposed to professional on line gamblers), a cut in concession costs would be much more effective than any cut in takeout.

Anonymous said...

i think the islanders should raise their ticket prices....
some people try to win and be entertained at the same time....
both southern and northern calf continuously offer five horse races and few positive equity situations and, to me, raising takeout is just another slap in the face.
the best analogy i can think of is las vegas is having hard times due to the economy and many people are losing jobs so they are changing blackjack to ties lose...i am sure many people will still play

Cangamble said...

Gib, Horseplayers are the consumers. In almost every other business, prices are determined by supply and demand. Not horse racing. They have never tried to find optimal takeout.
As for the tote board showing the odds and taking or leaving it, many horseplayers have chose to leave it as we've seen handle tank during a time when betting has become available to almost everyone.
The racing execs and the horsemen groups have positioned the game into a death spiral.
The typical casino takeout? Sports betting 4.6% for one team bets, 12% on 3 team parlays. But since the odds are fixed and not parimutuel, the odds are actually lower than that.
Blackjack 1.5%. Slots 8%.

Figless, you can choose to contribute to horse racing's death spiral if you wish. It is your choice.

As for putting on the show. The optimum price for takeout and the cost to put on the show are mutually exclusive. If you think otherwise, you don't understand the business at all.

BTW,many tracks pay nothing or next to nothing from takeout on taxes.

Alan, the takeout experiment in Maryland. 10 days. The signal wasn't available everywhere as some ADWs and tracks wanted no part of allowing customers to bet into a low takeout like that.

Consequences of takeout reductions and increases take years to be fully realized usually.

What we are experiencing in the industry today is the consequences of higher blended takeouts (supers and triactors in every race, etc.) coupled with racing's determination not to compete as a gambling game.

markinsac said...


BOSS: Happy Holidays and I thank you for coming to our Christmas Party. Now it's time to open presents. Hmm, our first gift is from John Sadler to Doug O'Neil. Doug what did you get?

DOUG O'NEIL: Oh my, it's one of those new contraptions called the "Vladimir Syringe". You inject your horse with this and it goes undetected. I'll give it to my vet immediately!

BOSS: The next gift is from Bob Baffert to John Shirreffs. John what did you get?

JOHN SHIRREFFS: Bob you shouldn't have. It's a plane ticket to Long Island where my career in horse racing started out. But hey Bob, it's a one-way ticket. What's up with that?

BOSS: Our next gift is from "DISGRUNTLED BETTOR" to Del Mar steward Scott Cheney.

SCOTT CHENEY: Wow! It's a kaliedescope! I just love looking at these! Thanks disgruntled!

BOSS: And now our next gift is from trainer Bill Spawr to jockey Patrick Valenzuela. Pat, what did you get?

P VAL: Neat! It's a BREATH-O-LIE-ZER, take a shot of this before a test and come out cleaner than Mother Theresa! Thanks Bill!

BOSS: And our last gift is for yours truly, let's see, oh, it's just what I needed, a fan! How did you know? I've been losing fans over and over again . . .

Anonymous said...

Horse racing is all fixed anyways.
so they can take out 94% for all we care. boycott horse racing altogether

Anonymous said...

Bill Finley could not be more right.

I'm hoping no one bets California racing and its 4 and 5 horse fields.

Greg said...

This is just another case of the California industry sticking it to the players. A few years back when the CA worker's compensation insurance costs went thru the roof, the industry got the Legislature to pass a "temporary" increase in the tackout to cover those costs. The fans were assured that it was temporary - even told to me by the Exec Dir of the TOC. Today, those costs are lower but the takeout remains. We are being told the higher takeout resulting in higher purses will result in a better product. Though born, raised and live in Los Angeles, on this issue I am from Missouri - SHOW ME! When this fails, lower the takeout!!!

Anonymous said...

Figless said...
If you really want to put fannies in the seats, and help the "downtrodden" horseplayers (as opposed to professional on line gamblers), a cut in concession costs would be much more effective than any cut in takeout.

Yeah a cheaper hot dog should do the trick. SoCal racing is saved by Oscar Meyer! Priceless...LOLOLOLOLOL

Figless said...

anon - $9 beers do keep folks from returning to the track, but you wouldnt know since you probably never actually leave your house.

I never claimed it would save the industry, would it would entice folks to come to the track, hence my "fannies in the seats" reference.

Cangamble, I indicated that I was in favor of reducing takeout, I just want the goverment share reduced.

IF you think they can reduce takeout to casino levels and still run the plant you are the one that does not understand the game or the regulation involved. Sure, handle would increase, but nowhere near enough to pay the bills and the government.

"BTW,many tracks pay nothing or next to nothing from takeout on taxes." ??? - please explain?

Every track in this country pays a flat tax on handle as takeout.

markinsac said...


BOSS: Back that truck up, Fred. OK, park it right there.

EMPLOYEE 310: Gee boss, what's in the truck?

BOSS: It's the latest version. A machine guaranteed to go zero to 100 in less than 5 seconds . . .

EMPLOYEE 310: Who are they for?

BOSS: The bettors. We have one for everybody.

EMPLOYEE 310: Can we afford to give every fan a new sports car?

BOSS: Judging by the crowds on Thursdays, maybe we could. (chuckles all around). No you nincompoop, these are new state-of-the-art ATM machines. They will take the player form zero dollars to 100 dollars in less than 5 seconds. Since we've raised the takeout a smidgen, we felt these would come in handy! Fred, take 12 to the main level, 14 to the mezzanine, 11 to the Clubhouse . . .

EMPLOYEE 310: Wow Boss, you are brilliant.

BOSS: We're here to service the customer!

Cangamble said...

Figless, I'm not talking about blackjack levels, but optimal takeout levels. Those are the levels where horsemen and tracks make the most money.
It has zero to do with the cost to put on the show btw.
If a small casino costs $25 million a year to run year round, but they know that if slots are optimally priced at an 8% rake (and they make $100 million in net revenues), but if they raise it to 10%, they only make $90 million in net revenues per year), they will stick with the 8%, even if costs suddenly shot up to $30 million a year to run the casino.

BTW, the reason 8% seems to work is that it is the number that seems to get players to play long enough to think they have a chance at winning money. They are more likely to get hooked and return, sometimes with family members or friends, who potentially can get hooked.

They may leave the place with more money in their pockets, or they may play longer than they would had higher rakes....both of these things, leads to more long term revenue when it comes to gamblers.

Another thing, what does the California state get on each $2 bet? I think it is zero. So it would be pretty hard to lower that number.

Figless said...

Cangamble, a casino's costs are fixed, there are other variables, most importantly purses for racetracks.

More purses bring more horses results in more handle.

I do not disagree with the premise of lower takeout but takeout is not the only part of the equation.

California State takes a fixed percentage of every dollar bet, pennies on every $2 wager. The tracks, or in reality the gamblers, are still sublect to a flat tax on gross handle.

It is not apples to apples with casinos.