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Monday, December 2, 2013

The Premier Speaks

I came across an article from Standardbred Canada's website where they posted a response Ontario Premier Kathleen Wynne made with regards to an article in the Ottawa Citizen which indicates racing is still on shaky ground, especially in Eastern Ontario where many of the smaller tracks not slated for part of the Ontario Harness Live circuit are located, meaning they would share in only 10% of the funding over the next five years.  The article goes on to say the opposition parties would restore the Slots at Racetrack Program (SARP) with some revisions.

In Wynne's response, this paragraph is particularly telling:

The future for the industry, and this is true across North America, is in building a new fan base for the sport. Tying revenue to products unrelated to racing has been identified in three separate reviews as poor public policy. Our plan provides the appropriate public support to maintain a foundation for racing based on solid business planning, but, more importantly, it provides opportunities for growth.

Let's not kid ourselves, assuming the opposition parties came through with their promise to restore SARP in some flavor (politicians have a way of promising and not delivering) the industry would get a shot in the arm which would have things going along swimmingly, until the next time the government needs the money which means all SARP would be is an infusion, keeping racing alive but not curing what ails it.

SARP is not the answer for making racing stronger it is a formula for business as usual.  To make racing stronger, fundamental changes to the industry are needed, in all of North America.  It would mean making racing competitive with alternative forms of gaming.

It means:
  • Cutting the takeout rate to competitive levels.  I am not saying matching what the slot machine takeout rate is but getting takeout rates down to 10%.
  • It means offering exchange wagering.
  • It means offering new, exciting bets, perhaps the V75, a Double Quinella.  Bets that appeal to the large player and the casual player.  Let's face it, show wagering doesn't cut it.
  • It means developing new access points, ways for the customer to avail themselves of the product.
  • It means freshening up the product such as introducing RUS on the betting menu.
  • It means making the product more palatable to modern sensibilities (addressing the unwanted horse problem, perceived abuses) 
  • It means cracking down on the improper use of medication (what is done by the JRA and Hong Kong could be a model)
  • It means offering a consortium non-profit organization to compete with ADWs to get more of the commission back to the tracks.  Not takeover the business but COMPETE..
  • It means offering less racing.  Economics dictate offering as much product as the market will bear, not drowning the market with excess product.  Real circuits instead of year round racing in one place is necessary.  I am not talking about one circuit but regional circuits.
  • Perhaps most importantly, get for-profit companies out of operating racetracks and have them run by non-profit organizations.  The current format of having gaming companies running racetracks is in most cases like having  the wolves guarding the hen house.
  • It means new racetracks.  I am not saying they need to be like the new Meadowlands Racing & Entertainment grandstand, they could be like hunt meet tracks are in steeple chase racing.
  • It means giving government support to the industry during a transition period where the industry would go from the current model to the new model.
  • Sadly, it means some people losing their jobs.

Yes, it means people losing their jobs.  As painful as it is to those in Ontario who are facing that problem, saving their jobs now may mean everyone losing their jobs later.  Having been through the down-size process myself I can attest it is no fun and I acknowledge the heartbreak it brings.  Hopefully the job shedding can be done gradually instead of wholesale.

The fact is slot revenue allows racing to go on as it is currently structured with no changes; it is unsustainable as sooner or later the plug will be pulled on any aid given.  The only way racing is going to survive is by making fundamental changes to the sport, changes which makes more racing fans be they customers in the stands or customers sitting in front of their computer.

I hate to say it, in the long run Premier Wynne is right.  Is anyone listening?

1 comment:

Pacingguy said...

If RUS can be successful in Europe and Australasia, there is no reason it can't be successful in North America. Granted, I don't think the product is ready to be wagered on but a little time spent to get it up to snuff will make it worthy of being on our cards.