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Sunday, July 11, 2010

Racing is Responsible for OTB's Failure?

Many in the New York media have been critical of OTB regarding the NYC OTB fiasco. In an editorial, the New York Daily News changes the tune by putting much of the blame for NYC OTB’s failure on the shoulders of racing. Specifically, the editorial claims: It's [OTB] going broke because it's forced to share too much of its dwindling revenue with harness and thoroughbred tracks, most of which are going broke too.

While OTB is indeed getting hurt by some of the fee’s they need to pay racing, the blame lies at OTB’s own door. Some of the fees OTB pays is due to the state recognizing that a state-run OTB operation is a parasite that lives off of racing; some fees were necessitated due to OTB’s own decision to feature out of state racing over its own in-state product. In addition, racing certainly can’t be blamed for receiving a commission for their signal; no sane person would suggest racetracks should be required to give their product away for free.

While OTB’s own excesses are responsible for a majority of OTB’s problems, what can’t be denied is racing has been in decline for years with less fans and wagering year after year. Some of the blame for this can be attributed to regulation which has kept racing from reacting to the changing environment, but a good part of the blame with respect to this lies at the foot of racetrack management and horsemen who for a long time hid their heads in the sand for a long time and refused to make any changes to the product, basically presenting the same product they have offered for the last fifty-plus years. For harness racing, it means 99.5% of the races being at one mile; fifteen to twenty minutes between races; resistance to a second tier of horses; too much racing; drivers who object to having to modify their whipping style to meet changing public sensibilities; charging patrons for programs and/or admission; high takeout rates when compared to other gaming options.

Other than attempting to attract heavy gamblers by offering new jackpot type wagers, what has racing done to improve the sport? Not much. Part of the reason is in racino states, slot revenue funds those generous purses and many of the “haves” will are unwilling to make changes which will benefit everyone in the long run. Here is a line from the editorial which should strike fear in everyone’s heart:

New York must undertake wholesale reevaluation of its relationship to the industry - putting dying tracks and OTB parlors out of their misery, giving viable facilities a chance to thrive and, above all, taking taxpayer support out of the equation.

It would serve no purpose at this time to list the New York tracks which would be considered un-viable. More importantly, unless we change the product we offer, how long do you think the other New York tracks would survive without taxpayer support (read that as extra payments from OTB and slot revenue)?

In case any horsemen outside of New York are thinking, this is a New York issue, you are wrong. This latest economic crisis has changed the way Americans feel about government largesse, resulting in governments looking for revenue from alternate sources. It is inevitable that governments across the nation are going to eventually make racing sink or swim on its own merits.

Racing needs to reinvent itself if it wishes to have a future. The time has come for all parties to come to the table and develop Harness Racing 2.0, a product which can sustain itself. You can only stave off the law of economics for so long, sooner or later racing is going to have to make it on its own or disappear.

1 comment:

Pacingguy said...

Here is something I forgot to put in my original posting.

For those who don't know, the New York Daily News is a newspaper which is newspaper friendly. They have an extensive racing section in their newspaper daily and have actually have people who cover racing. It would be one thing if a newspaper who stopped covering racing made these comments, but these comments were made by a "friend" of racing.