Duel In The Grandstand

TUCSON, Ariz., March 11 (UPI) -- When Louisana Downs, the popular Shreveport race track, was given permission to install slot machines in 1993, they celebrated by scattering slots through three floors of the grandstand.

You were never more than five seconds away from a slot. You could walk from the betting window to the slot handle and back without missing a race or losing your machine. You could even watch the race on a video screen and continue playing the slots while the ponies ran.

And the whole scheme was a disaster.

The horse bettors were furious to have the slot noise in their sanctuary, and the slot players were angry about being treated like second-class citizens.

Ray Tromba, the manager of Louisiana Downs, had just learned the hard way what every other "racino" now recognizes: There's no way to integrate slot machines into a race track. Slots players and horse bettors are two entirely different species. Horseplayers don't play slots, and slots players don't bet horses.

At Louisiana Downs, they eventually moved all the slot machines to the first floor. The second, third and fourth were returned to the horse people. And now that the twain could never meet, except perhaps occasionally on the elevator, the business took off.

At the recent Racing and Gaming Summit, where race track owners gathered to discuss how to maximize profit from slot machines, I got this gnawing feeling that they've given birth to some kind of Frankenstein's Monster that has nothing to do with racing and eventually could destroy it entirely. They're clutching at slot machines because live horse racing (and dog racing, for that matter) has been declining for the past 20 years. But this solution--of turning every race track into a casino--seems fatally flawed to me. By chasing after short-term profit, they might be driving nails into their own coffins.

Let's start with the basic nature of these two forms of gambling. Horse bettors start planning their gambling day 24 hours ahead of time. They buy the Daily Racing Form in the afternoon and study TOMORROW's races. Reading a past performance chart in the Racing Form is not a simple task. There are hundreds of bits of information on each horse, all embedded in agate type, and the bits of information don't mean anything in isolation-- they have to be compared to the other horses in the same race.

Most tracks average ten races a day. Then, if the bettor is also betting on other tracks via satellite feed, he could have as many as 70 races to study. Assuming about eight horses per race, that's 560 past performance charts to look at before he even makes his first betting decision. Then he has to decide which races to bet, how much to bet on each horse, which horses to bet in parlays, and how high the odds need to be to make each bet worthwhile.

In other words, it's like cramming for a math final every night. And even then his job is not over. The serious bettor goes to the paddock before each race and looks his horses over to make sure they're not exhibiting any physical defects. Then he watches the tote board to make sure his horse doesn't get bet down to such low odds that the bet becomes worthless. The whole puzzle- solving process is labor-intensive and time-intensive.

Now let's examine the slot-machine player. His betting decision occurs two seconds before he decides to pull a particular handle on a particular machine. And if he decides he doesn't like the way the lights are flashing or the reels lining up on that one, he simply moves to another machine. It's not labor-intensive, it's not time-intensive. It is, in fact, mindless pure chance.

Can there BE two more different personality types? Whose idea was it to harness these groups together in the first place?

According to Mike Shagan, a business consultant and attorney who helped launch Off-Track Betting in the seventies, it was the state legislatures. "A race track is a benevolent facility to a politician," he said. "When you give a track the right to have slots, you are not creating a geographic expansion of gambling. It's a way to limit gambling but still provide benefits to racing. From the government point of view, the health of live racing is still important."

So the tracks accepted the slot machines as a way to compete for the gamblers who had been lost to casinos. But my question about this is: how can you lose a horse bettor to a casino in the first place, if, as we now know, a horseplayer is not really interested in games of pure chance? Over the two days of this conference, I was never able to find anyone who could adequately answer that. Could it be that the horse-racing product itself is what has driven gamblers away? And could it be that they didn't leave to chase gambling opportunites somewhere else, but just . . . left?

Still, hope springs eternal, and there are racing consultants out there who claim it's possible to take a slots player and make him into a horse bettor. "Long-term, I think you can integrate the two," says Saverio "Sal" Scheri III, Managing Director of WhiteSand Consulting. "We do have an opportunity to take folks and cross them over. And to do that, direct mail is king."

The idea here would be that the slots bettor constantly gets coupons in the mail that make it advantageous for him to place horse bets while he's at the track. Similarly, the horse bettor is comped with coupons tied to slots betting. The hope is that each will discover the charm of the other kind of betting.

I don't really buy this either, though, because I think all the gamblers already KNOW about other forms of betting. Of the two possibilities, the more likely one is to convert a slots guy into a racing guy, simply because most simple bettors regard horse racing as arcane and hard to figure out. Anything that tends to make it painless is going to help--but a slots bettor is still likely to just choose the prettiest horse or some other decision like that, and that's a sure way to end up losing enough money to get burned out on the idea.

Bruce Wentworth, General Manager of the Dubuque (Iowa) Racing Association, says that he introduced 600 slots into his track as early as 1985, and to get "crossover" business, he scattered TV sets with racing feeds all over the slots floor. The sets have video but no audio. Still, he's had only limited success. "The customer wants to know 'How hard do you have to work to make this bet?'" he says. "The more complicated the game, the older the crowd."

David Pye, Vice President of Corporate Development for Scientific Games Corp., had a similar experience at the tracks in West Virginia, which was one of the first states to launch racinos.

"Our idea was to bring racing to the customer directly through the VLT [the slot machine screen itself]," he says. "The results of offering racing in the VLTs is that now we get a large percentage of the handle that way--47 percent of all racing, and 6 percent of live racing. It also varies by the day of the meet. We get 64 percent of the handle through VLTs on Tuesday, and only 13 percent on Saturday when the machines are busier. With vouchers, we know that 66 to 70 percent of race winnings are re- bet on the VLTs. Still, racing is only 1 to 6 percent of the gaming handle."

The experiment still doesn't necessarily prove anything. A horse bettor could use the VLT to make his bet, yet never make a slots bet.

My fear about all this is that, with the tail wagging the dog, and with income at tracks breaking down 80 percent slots and 20 percent horses, future managers will tend to spend less and less on racing and more and more on turning the whole facility into a slots parlor. Then all you have is a casino that happens to have horses running around out back. If the idea of this is to strengthen horse racing, wouldn't it be better to put ALL the profit into better purses, which leads to better horses, which leads to better races, which leads to excitement based on the sport itself?

But even if you did that, eventually the slots player would start screaming that he's being neglected. There's already some grumbling that the comp system favors the horseplayer over the slots better, which is pretty much true. And the slots player is going to be bored with any details about why you need bigger purses and better horses.

As Ray Bailiff of the Oklahoma Racing Commission put it, "All he knows is that twenty minutes is a long time to wait to be entertained for two minutes."

*

© Copyright 2003 United Press International and Joe Bob Briggs

Return to the Column Archive