Racing think tank issues 'call to action' over sports betting

In a recently released report on the effects of legal sports betting on racing, Thoroughbred Idea Foundation wrote that "we believe this paper should serve as a call to action to begin down the path towards modernization, creating new ways to bet on the sport and ensuring racing’s sustainable future."

“TIF Reports: Horse Racing and ‘Legal’ Sports Betting” urges the creation of new bets and the modernization of horse racing before the “narrow window of time” closes for horse racing to remain competitive. The Thoroughbred Idea Fountation, whose board of directors includes, among others, Glen Hill Farm's Craig Bernick, former jockeys Donna Brothers and Gary Stevens, as well as top horseplayer Paul Matties, insists racing has "maybe two or three years" to catch up in states that have already implemented legal sports betting.

Among the benefits for consumers playing sports: fixed odds and lower takeout. Expanded legalization followed last year's U.S. Supreme Court decision declaring the Professional and Amateur Sports Protection Act unconstitutional. Now, states can individually decide to legalize sports betting, and the Thoroughbred Idea Foundation notes eight state and the District of Columbia have already moved forward in some form.

Fixed odds and machine-learning are two areas mentioned where sports betting has a leg up on horse racing. Unlike the pari-mutuel tote, in which the odds change as players place their bets, fixed odds allow bettors to know the price they will receive if they win. Machine-learning also allows for customizable bets with automated prices. If horse racing were to implement the technology, the TIF provides examples such as creating an over/under on the number of Chad Brown-trained winners on Travers Stakes Day at Saratoga, or allowing customers to create their own parlays and combine races from different tracks and other sporting events. 

Professional bettor and horseplayer Maury Wolff, who is a member of the Wagering Systems Task Force, organized by the National Thoroughbred Horse Association, expanded on what comes along with the legalization of sports betting.

“‘Legal’ means infrastructure, strategic planning, investment and innovation, mobile delivery, customer service standards, marketing and advertising – lots of advertising,” Wolff said. “And importantly, it comes with the assuredness of being paid. That adds up to a lot.”

The TIF also compares horse racing’s takeout rate to that of sports betting. Horse racing’s average takeout is about 20 percent, while sports betting is closer to 5 percent.

“We believe the most meaningful way racing will benefit, directly, is to meet the exploding sports betting industry where it is – with fixed-odds and exchange offerings to its existing and potential customers, and the development of new ways to bet on the sport,” the white paper reads. “Furthermore, the cost of a racing wager – takeout – must decline if racing is to survive in this market.”

Read the full report: Horse Racing and ‘Legal’ Sports Betting.