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Wednesday, October 13, 2010

Surprise, Surprise

A casino opens in Maryland.  Atlantic City is hurt by it.  Nothing new here.  However, what is new is Dover Downs and Harrington are hurting as a result of the first casino in Maryland opening and will likely be hurt further as additional casinos open in Maryland.  The immediate consequence will be reduced purses for horsemen and if revenue estimates for the state continue to drop, horsemen and track operators may face a state looking to cut horse racing's percentage or open additional casinos to get some of the revenue flowing to Maryland back into Delaware which may further cut the horsemen's share and purses.

What we are seeing is not only convenience gambling growing, but casino gaming becoming a commodity where there will be a casino popping up all over, cannibalizing existing casino's profitability forcing them to run more efficiently in order to survive on mediocre profits.  When casinos open up in Ohio, racinos in the Western part of Pennsylvania (The Meadows) will be hurt as may racinos in Indiana.  Once a casino or racino opens up at the Meadowlands as will eventually happen, Yonkers (which will already be hurt by the racino at Aqueduct) will be seriously hurt by a Meadowlands gaming parlor as may Pocono Downs.  This process will continue as additional casinos and racinos open up in other states.  As this happens (less dramatic) increased purses at some tracks will be met with corresponding decreased purses at others.  The golden slot revenue will becoming silver or bronze-tinted. 

Hence, it is important racing interests, including track operators, who will be hurt just as much as horsemen, must develop strategies to retain or grow their business further.  It may involve allowing people to make wagers at their local convenience store or lottery outlets or making their facilities full entertainment centers.  And yes, the possibility of cutting race dates to stretch the shrinking slot revenue exists.

Elsewhere, Standardbred Canada has announced an Xtreme racing series where there will be sprint and distance races which will include a second tier.  One of the goals of offering the series will be to determine if sprint and two-tiered distance races will be accepted on a regular basis instead of a once a year event.   

1 comment:

The_Knight_Sky said...

Early bird that got the worm was DelPark and they figure to take a hit purse wise also with the proliferation of Maryland Casinos.

Yes, Yonkers also figure to slide down the ladder shortly.

What are racetracks planning to do to retain their racing business? Are they planning on lowering the takeouts, offer amenities, provide superiour customer service over the next racino? One can only hope.