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How Long Can Racing Fend Off the Sports Betting Juggernaut?

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How Long Can Racing Fend Off the Sports Betting Juggernaut? TUESDAY, OCTOBER 20, 2020 HOW LONG CAN RACING RADICAL CHANGE, STATUS QUO, OR MIDDLE GROUND FOR NEW YORK WHIP FEND OFF THE SPORTS RULES? by T.D. Thornton BETTING JUGGERNAUT? New York has lagged other racing states in addressing changes to whip use designed to be more humane to Thoroughbreds. But not being an early adopter of controversial new rules can sometimes be an advantage, because regulators are able to assess what is and isn't working in other jurisdictions before making potentially radical modifications to long-standing practices. That was the tone of discussion during the Oct. 19 teleconference meeting of the New York State Gaming Commission (NYSGC), which conducted what amounted to a 2 1/4-hour opinion-gathering dialogue on whether or not the state should adopt new whipping rules. No new regulations were proposed and no official vote on the matter was taken Monday. Cont. p6 IN TDN EUROPE TODAY Gulfstream mutuel tickets | Coglianese RECORD-BREAKING SIYOUNI COLT HEADS ARQANA A colt by Siyouni (Fr) brought a new Arqana October Yearling Sale The Week in Review, by Bill Finley record, selling for €525,000 during the opening session. Emma Berry When it was announced last week that a record $748.6 million reports from Deauville. had been wagered on sports during September in New Jersey Click or tap here to go straight to TDN Europe. that appeared to be more bad news for horse racing. It was the most ever bet in any one state during a month and a sign of the times. The amount legally wagered on sports in this country is soaring, with no end in sight, and it stood to reason that some of that money had been siphoned off from racing. Sports betting is now available in 18 states plus the District of Columbia, and 13 other states have introduced bills to legalize sports wagering. Despite a near complete shutdown of sports in the spring and early summer, the record $13 billion bet legally on sports in 2019 will be shattered this year. When the Supreme Court overturned the Professional and Amateur Sports Protection Act (PASPA) in May of 2018, it was widely feared that sports wagering would lure away a healthy chunk of racing=s customers, causing a deep decline in handle. That may yet happen, but racing has, so far, been surprisingly resilient in the face of what figured to be a serious threat to its bottom line. During the same month that sports bettors in New Jersey set a record, pari-mutuel wagering on racing in the U.S. rose by 29.64%. Cont. p3 PUBLISHER & CEO Sue Morris Finley @suefinley [email protected] SENIOR VICE PRESIDENT Gary King @garykingTDN [email protected] EDITORIAL [email protected] Editor-in-Chief Jessica Martini @JessMartiniTDN Managing Editor Tuesday, October 20, 2020 Alan Carasso @EquinealTDN Senior Editor Steve Sherack @SteveSherackTDN Racing Editor Brian DiDonato @BDiDonatoTDN Deputy Editor Christie DeBernardis @CDeBernardisTDN Associate Editors Christina Bossinakis @CBossTDN Joe Bianca @JBiancaTDN News and Features Editor In Memoriam: Ben Massam (1988-2019) ADVERTISING [email protected] Director of Advertising Alycia Borer Advertising Manager Lia Best Advertising Designer Amanda Crelin Advertising Assistant/Dir. Of Distribution Rachel McCaffrey Advertising Assistants Amie Newcomb Kristen Lomasson Photographer/Photo Editor Sarah K. Andrew @SarahKAndrew [email protected] "The minute we saw her, we knew we had to have her." So says Bob Baffert about Bast. Three Grade I wins later, she gets ready to sell at Fasig-Tipton's Night of the Stars, in Social Media Strategist foal to Baffert's Triple Crown winner Justify. Click here or on the photo above to see Justina Severni Bast now and hear her connections talk about the filly. | Horsephotos Director of Customer Service Vicki Forbes [email protected] STAY THIRSTY COLT TOPS FASIG CALIFORNIA SALE 10 A colt by GI Travers S. winner Stay Thirsty brought the highest Marketing Manager bid of Monday’s Fasig-Tipton California Fall Yearlings Sale at Alayna Cullen @AlaynaCullen Los Alamitos when selling for $200,000. Director of IT/Accounting Ray Villa KYLE NAMED TIEA FINALIST 15 [email protected] David Kyle is one of three finalists in the Dedication to Breeding [email protected] Award category of the Thoroughbred Industry Employee Awards (TIEA), presented by Godolphin. WORLDWIDE INFORMATION International Editor TODAY’S GRADED STAKES Kelsey Riley @kelseynrileyTDN EST Race Click for TV [email protected] European Editor 6:40a Prix des Reservoirs-G3, DEA -------------- TVG Emma Berry [email protected] Associate International Editor Heather Anderson @HLAndersonTDN Newmarket Bureau, Cafe Racing Sean Cronin & Tom Frary [email protected] 60 Broad Street, Suite 100 Red Bank, NJ 07701 732-747-8060 | 732-747-8955 (fax) www.TheTDN.com TDN HEADLINE NEWS • PAGE 3 OF 16 • THETDN.COM TUESDAY • OCTOBER 20, 2020 The Week in Review (cont. from p1) And sports betting has a lot better chance than racing does of attracting future generations of potential customers. Because the Kentucky Derby was rescheduled and run over the There=s also the cost of placing a wager. The average takeout Labor Day weekend rather than in May due to COVID-19, the on a racing bet is around 20%, a price that was installed when September numbers can=t be taken on the surface. Perhaps a racing was the only sport that could be wagered on legally. better indicator is the number for the first nine months of the That=s more than double the price of making a sports bet, where year. Despite all the havoc the coronavirus played on racing the effective takeout is 9%. schedules, wagering nationwide for the year is down by just $246 million or 2.86%. With a strong final three months, it=s not impossible that the final numbers for the year will be even with the pre-coronavirus numbers from 2019. There may be several scenarios in play here. The most obvious is that sports bettors and racing bettors could be two different animals and there is little crossover between the two. The same phenomenon largely occurred when so many tracks opened up casinos. Dennis Drazin, the chairman and CEO of Darby Development, the operators of Monmouth Park, said he has seen no signs that the track=s racing bettors are shifting over to sports. None of which means racing shouldn=t take the sports betting threat lightly. Estimates are that within three years it will be legal in at least 30 states. That list could include California, Kentucky and Florida, three of the most important racing states. Sports betting is not yet legal in any of them. It is legal in New York, but not on-line and is limited to in-person betting at only Dennis Drazin | Equi-Photo some of the state=s casinos. TDN HEADLINE NEWS • PAGE 4 OF 16 • THETDN.COM TUESDAY • OCTOBER 20, 2020 Bettors are rational consumers who react to pricing and racing=s exorbitant takeouts are giving them a valid reason to choose sports. That should mean that racing will make what seems like an obvious adjustment and drastically lower the takeout. That=s not going to happen. There are other ways for racing to try to keep pace with sports betting. Currently, a racing bet can=t be made on a sports betting app or website. If that can change and a sports bet and a racing bet can be made from the same account that could lead to some sports bettors trying their luck at racing. AWe need to have horse racing on the same platform with other sports betting products,@ said NTRA President and CEO Alex Waldrop. ABettors need to be able to use the same wallet to bet on each. That hasn=t happened and that is a disappointment.@ Alex Waldrop | Horsephotos The other avenue is in creating racing bets that mirror sports bets, starting with fixed odds wagers. Try explaining to the sports bettor why they can bet a horse at 7-2 only to have its odds drop to 2-1 after the race has begun. Once you have wagered $110 to win $100 on the Giants to cover the spread, the bet doesn=t change so that you can only win $80. Monmouth had hoped to institute fixed odds wagering as this year=s meet, but Drazin said that the New Jersey Attorney General=s office has yet to give a green light to the project. It should be available for the 2021 racing season. It=s hard to tell where this is heading and what impact sports betting will have on racing in, say, five years from now. Racing is holding its own for now, but how long can that last? Kentucky Downs and the Graded Stakes Committee Being on the American Graded Stakes Committee is no doubt a thankless job. At the end of the day when the grades are handed out someone is going to be unhappy. Cont. p5 TDN HEADLINE NEWS • PAGE 5 OF 16 • THETDN.COM TUESDAY • OCTOBER 20, 2020 But the complaints expressed by Kentucky Downs Trainers, particularly those outside of Kentucky, were slow to management last week that its races aren=t being fairly judged embrace the quirky European-style racetrack, but that has by the committee is a valid one. When you have 16 stakes races changed. It was just a matter of time until the purses became so that are worth, on average, $537,500, you have every right to high that people couldn=t stay away. That=s no doubt the reason expect better. That only five of the races are graded and none that trainers such as Chad Brown, Bill Mott, Christophe Clement, higher than the Grade III level doesn=t make any sense.
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