Tote Protocol, Signal Pricing Debated at Conference

One day after the first public presentation of the National Thoroughbred Racing Association Wagering System Task Force report, two issues central to the report--wagering systems and signal pricing--were discussed in depth Sept. 21 on day two of the International Simulcast Conference in Miami Beach, Fla.

In a presentation titled "Upgrading the Wagering Landscape," David Haydon, president of InCompass; Magna Entertainment Corp. chief information officer Steve Keech; and J. Curtis Linnell of the Thoroughbred Racing Protective Bureau each took the podium to explain facets of the new system called "wagering transaction protocol."

The system, in development by a group of data wagering specialists, was originated last December as an outgrowth of the issues dealt with in the NTRA report, and was described by Linnell as nothing short of a re-invention of the tote system.

"The Thoroughbred industry cannot keep outsourcing this to the tote companies," said Linnell, a wagering analyst for the TRPB. "The industry has got to be in control of all aspects of wagering."

Among the features of the new protocol are real-time transmission of wagering data into the pool of the host track, complete verification of the source of wagers, and improved security measures. The latter, Haydon said, sprung directly from the 2002 Breeders' Cup Ultra Pick 6 fraud.

One aspect of the presentation that was called into question was the insistence of the speakers that the cost of implementing the new wagering system not be considered during the development phase. "Has there been any consideration of the costs?" asked conference attendee Steve Molnar of United Tote.

Citing numerous problems with existing wagering platforms, discussion moderator Chris Scherf of the host Thoroughbred Racing Associations quickly replied: "As an industry, we cannot afford not to do this."

Also on the agenda was a panel discussion of how racetracks price their services, a discussion prefaced by Linnell's remark that the "pari-mutuel industry has typically not had a good history of pricing." Included were descriptions by Steve Mitchell of Woodbine Entertainment, Peter Berube of Tampa Bay Downs, and Charles Vickery, consultant to the New York Racing Association, of the outcomes when those tracks reduced takeout rates.

While Berube hailed Tampa's reduction in 2004 as "an across-the-board success," Mitchell and Vickery were less enthusiastic in describing the effects of takeout reductions at their tracks.

With large bettor David Cuscuna also providing input, the panel concluded that, in locations where regulation permits, tracks should consider establishing different takeout rates for different locations wagering into their pools. This, they believe, could help offset variations caused by rebate shops.

"Not all bettors are equally price-sensitive," Cuscuna said. "It only makes sense to customize your program to the group that provides you the greatest churn."