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Monday, August 22, 2016

Why is Exchange Wagering Being Resisted?

With Betfair having started exchange wagering in New Jersey, one has to wonder why the only harness tracks which offer it are the Meadowlands and WEG.  My question is, why?  Why the resistance towards exchange wagering.

Full disclosure, I love exchange wagering.  Who wouldn't after years of getting their 15-1 shots crushed to 3-5 after the race begins?  Maybe I could play the exchange better, but let me tell you, knowing you are getting the odds you put your wager in at is a satisfying feeling.

No, the promised for cut in takeout isn't as deep as it was originally promoted, the vig being 12%, but 12% is a lot better than you get with regular wagering.  The one bad thing is the way you see the takeout taken.  Whereas, in regular wagering the odds you are going to be paid are shown after the takeout has been taken, in exchange wagering you see the full price and the takeout being a separate line item; so when you win $10, you see $1.20 being deducted, netting you $8.80.  But if you can get past this visual, isn't 12% better than 18%, especially if you don't get a rebate?

Yes, exchange wagering eliminates rebates, but isn't it better if everyone gets a defacto rebate instead of just the high rollers?

Still, why don't tracks sign up for exchange wagering, if only for out of state customers?  Let's not kid ourselves, tracks want to make as much money as possible so maybe you they are hesitant to ofer exchange wagering in-state, especially if a track offers their own ADW.

The only reason one can see to offering exchange wagering to out-of-state horseplayers is the liquidity.  Wagers bet through ADWs provides for your own pools, but one needs to consider the fact a $1 wagered through an ADW contributes (on average) 1.5 cents to the track and the same to the purse account.  But the exchange contributes 3 cents to the track and the purse account; double what is being made in simulcasting.  Still not a lot, but with most wagering occurring of track, isn't twice as much earnings better than nothing?

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