Posts Tagged ‘thoroughbred racing’

The challenges that confront racing seem to be the sport’s universal language, and potential solutions, it seems, are similar from one continent to another. Winfried Englebrecht-Bresges, CEO of the Hong Kong Jockey Club and chairman of the Asian Racing Federation, outlined those challenges and proposed some solutions during his opening address of the 32^nd Asian Racing Conference in Tokyo on Tuesday morning.

Among the hurdles are laws in some countries, most notably Hong Kong and Japan, that prohibit or restrict commingled betting; double taxation on commingled bets; marketing and sponsorship issues; TV and data rights questions, and software challenges among tote companies that will require investment and commitment by the various stakeholders. “We will struggle if we won’t change,” he said.

Englebrecht-Bresges outlined what he called “three guiding principles” to address the challenges. Racing must exert influence on the regulatory side, he said, because “the integrity of the sport is a fundamental issue. Drugs will bring the sport to its knees if we don’t proactively fight this problem.” He referenced cycling and how the burden of doping could cost the sport dearly in lost television rights if not addressed.

Secondly, Englebrecht-Bresges said, the industry must facilitate the sharing of best practices in racing and in other outside industries by bringing together stakeholders who have common interests.

Finally, he said, bigger organizations must mentor smaller organizations, especially those countries who are in the early stages of expanding their racing and/or breeding industries.

While some countries are in that early stage, Englebrecht-Bresges said, overall there is stagnancy for the Asian Racing Federation members, with six-year projections that show pari-mutuel wagering turnover declining while other forms of gambling enjoy moderate growth. “We will be a dinosaur,” he said, adding, “it’s not that we are unattractive. But we have to offer different value propositions.”

Not surprisingly, those value propositions are predicated on knowing what customers want, especially new customers that racing needs if it is to survive. He called for all jurisdictions to conduct strategic assessments, and outlined some of the findings the Hong Kong Jockey Club discovered in its own research. Non-racing fans see no relevance in the current racing schedule/fixtures, programs and bet types; much of the activities are not appealing to young people, women, families, and the middle class. Racing lacks innovation, and has a poor approach to its “channel strategy” and customer loyalty programs. Furthermore, he said, industry fragmentation is a key reason for slow response to the challenges.

Regarding channel strategy, Englebrecht-Bresges said racing is “catering to its current customers” through its web sites, where new customers “get lost. We need an integrated channel strategy” that will appeal to existing, new and potential customers, he added.

Englebrecht-Bresges said racing must reach the next generation, but that the strategy of attack must be powered by customers, especially the new customers with which the industry must learn how to better communicate.

“We are in a race,” said the German native who has been with the Hong Kong Jockey Club for 10 years. “Is it a race we can win?” 

Englebrecht-Bresges then showed a slide of America’s new president-elect, Barack Obama, featuring the campaign theme of change that stated “Yes, we can.”

“I say," Englebrecht-Bresges concluded, "‘Yes, we must.’"

THE REST OF TUESDAY MORNING’S conference program was baffling. Following Engelbrecht-Bresges was Hiroshi Okuda, who rose through the ranks of the Toyota Motor Corporation to become president and later chairman and is now chairman of the board of governors for the Japan Racing Association.

It’s possible Okuda brought the wrong speech to the Asian Racing Conference, for he devoted his entire talk to "global warming issues." I guess if we all rode horses instead of automobiles, we could help develop a low carbon society, as Okuda said is necessary. But I’m not sure what major impact racing executives could have on global warming.

If that talk didn’t cause the conference focus to jump the tracks, the next two certainly did. Robyn Williams (no, not that one), described as a "mad cap science presenter" from Australia, enlightened (?) the audience about how the world will be changing due to technology. You know, robotics, energy and transportation. Hell, I learned that from watching too many episodes of "The Jetsons" as a kid. In truth, Williams was at least entertaining, and would have made a good lunch-time speaker. But he added little to the serious issues at hand among the Asian Racing Federation delegates.

Andrew Main, the morning’s final speaker, likewise, had little to say linking racing to his area of expertise as business editor of The Australian newspaper.

Filling the opening morning with three speakers who had little relevance to racing left many in the audience scratching their heads and wondering who thought this was a good idea.

Sign up for our Email Flashes to get the latest news, analysis and commentary from Ray Paulick

By Ray Paulick

Best unintentionally funny line of the week came from John Brunetti, the owner of Hialeah Park. Discussing a conversation he had with Halsey Minor about the technology wizard’s interest in buying and reviving the shuttered South Florida racetrack, Brunetti was quoted in a trade publication as saying: “I have told him that in some ways I don’t think he understands this business.”

Does Brunetti think he understands this business? How could he? If he did, how did he let Doug Donn outsmart him on every move and get control of the best winter racing dates for Gulfstream Park? Why did state legislators and regulators turn their back on him? How did Calder crush Hialeah in head-to-head competition? Why did Brunetti raise take out to the point that he chased away any remaining horseplayers Hialeah had? Why has the track sat empty for more than seven years?

It’s a mortal lock that Hialeah will never reopen successfully with Brunetti as the owner and operator. I happen to think John Brunetti is a nice guy who loves racing, but I have zero confidence that he can revive Hialeah Park on his own (and I may be more optimistic than state officials or Florida horsemen).

Does Halsey Minor know everything there is to know about Thoroughbred racing? Of course not. But he comes to the game with passion, enthusiasm, capital and confidence that he can return Hialeah to some semblance of its past glory.

Brunetti isn’t the only industry veteran who thinks Minor may be nothing but a dreamer if he thinks he can revive horse racing as a sport. I’ve heard from a number of racetrack executives and horse owners who said they’ve heard it all before. But what is the alternative for Hialeah Park or operating tracks that are hanging on by a thread? Lobby to get slot machines, turn the facility over to a casino company and hope it will subsidize the money-losing portion of the business indefinitely?

Should Brunetti and others in the industry just blow off this opportunity that Minor presents to give horse racing in the Miami area one last chance to stand on its own as a sport?

I remember when Frank Stronach came into racetrack ownership and said he would try to make the sport more compelling and entertaining. In the beginning, Stronach said he had no interest in getting slot machines at his tracks. But Stronach became a victim of his ego, forcing in too many of his own bad ideas and forcing out too many executives who dared to disagree with him. He almost seemed obsessed with getting control of as many tracks as possible without having any idea what he was going to do with them all.

Gulfstream Park was the first Florida racetrack to get slot machines. Under Stronach’s vision, Gulfstream became the least successful slot machine operation in North America, based on the benchmark of dollars won per machine per day. Calder will be adding slots as early as 2009 after getting approval in a local referendum in January of this year. The rebuilt Gulfstream Park is more slots parlor and simulcast theater than it is a facility to host live racing. In short, it’s a disaster.

Calder, built to host hot-weather summer racing, has always struck me as a cold and impersonal track, but it’s never seemed colder or more impersonal than it is today. In a recent weekday visit there I stumbled across what seemed like no more than several hundred fans scattered throughout the first two floors (most of the third floor is closed).

Count on Churchill Downs management to pigeonhole those fans in as small an area as possible once the slot machines are installed and plugged in. Racing at Calder will become secondary, though its purses will be healthier than they are today because of the slot subsidies. But what will Churchill Downs management’s long-term vision be for racing at Calder?

Minor said he has no interest in bringing slot machines to Hialeah Park. The competition for slots players is intense, with the Seminole Native American tribe holding the market share advantage at their Hard Rock Casino in Hollywood, Fla. Minor wants to focus on the excitement of racing and the fact that it’s the only sport you can legally bet on. 

Racing needs people like Halsey Minor, and people in the industry should be doing everything possible to help him succeed.

Copyright © 2008, The Paulick Report

Visit the Paulick Report for all the latest news throughout the racing world.

Sign up for our Email Flashes to get the latest news, analysis and commentary from Ray Paulick